Title: No ETF, No Futures Market: Why 17% Of His Money Is In This Metal Show: Kitco NEWS Host: Jeremy Szafron Guest: John Feneck — portfolio manager / consultant, Feneck Consulting Group (Arizona) Date: 2026-09-02 URL: https://youtu.be/Kzx8LAUWgds Length: 40:38 Note: YouTube auto-transcript. Verbal fillers (um / uh / you know / I mean when contentless), stutters and false starts removed; wording otherwise verbatim and every (mm:ss) cue kept in place. Proper nouns the auto-captioner garbled are spelled correctly (Szafron, Feneck, Newmont, Barrick, Agnico, Denarius Metals, Serafino Iacono, Giustra, Friedland, Warsh, PDAC, Kitco, VanEck, rhodium, rhenium, Stillwater, Power Metallic, Guardian Metal, Skyline Builders / KAZR, Western Star, Triumph Gold, Hycroft).
00:00 Welcome back. I'm Jeremy Szafron. Now, two of the biggest gold miners on the planet, same three months, same gold market. We'll show a graphic here. Newmont generated a record $2.2 billion in free cash flow. Barrick generated 515 million. And it's attributable free cash flow. The part tied to Barrick's ownership share was just $141 million.
00:22 So, one of these companies is harvesting, the other one is building. And that's a question hanging over this whole sector right now. The miners are making more money than they ever have and the market still won't pay for it. Now, my guest has been in asset management since 1992, later on Sprott's precious metals team, but he was buying every single week through the summer.
00:40 So, I want to know obviously whether the last few days has changed his mind, what finally drags money into the small end of this market, and which of these companies he's actually willing to own. Let's get into it. All right, John Feneck runs Feneck Consulting Group out of Arizona where he and his team focus on resource equities. John, good to have you back.
01:02 >> Thanks for having me, Jeremy. Always a pleasure. >> Listen, it's been an interesting year you and I have witnessed in this gold and precious metals market. Tell me what this year has done to the people in your world because it has been violent. Gold set that record back in January, above 5,500 an ounce.
01:19 Late June, it was under 4,000. It's about 4370 as we speak on the spot side. Are people tired or are they just getting started? >> This has been a challenging year for investors because we had such a great 2025 in the sector, right? We were up 153% in our retail account, over 350% in our private account.
01:42 GDX and GDXJ were both up over 150% last year. This was the sector to own last year. Yet as you know Jeremy, 0.1% of the global investable capital is in our sector. So I think that you can see a move from 0.1% ownership of our sector to 1% ownership of our sector even by next year because of a sector rotation out of the broad market and into things that are safer.
02:10 Right? And we can talk about Newmont and Barrick as examples of that. But what I've seen this summer is carnage. The war that started February 28th or so was right before PDAC if you remember, which was the largest conference in our sector, right? So March 2 actually was a very good day coming out of the first day of PDAC and then March 3 was a reversal day and we really never looked back. March was an ugly month. May, June we kind of figured out where Trump was going with Iran and oil just kept going up and that's
02:42 not good for inflation. So when you have a new sheriff in town like Kevin Warsh on June 17th he said his first objective is managing inflation. Right? So this is the conundrum that we face as mining investors: how serious is the Fed here and what kind of bullets can they shoot? So as investors at Feneck Consulting, we're bullish here.
03:04 We're in a bull framework. Gold just held 3,900 like a champ. It didn't hit 3,500, which a lot of people were calling for, or even 3,300. Silver basically went and tested 50, but held it. It didn't even get there. It was 54, right? So, these are really positive things on the long-term gold and silver chart that you look for.
03:27 >> And look at the last 24 hours. Gold just printed 4,242.81 overnight. It's touched 4,398 today. So $115 round trip inside of a single session. And everything on my board today is green. Is that the flush? Is that what you've been waiting for? >> Basically, I think you could test 3,900 again here.
03:52 It wouldn't surprise me, a double test of that level, but I don't see us cracking 3,900 to the downside. So if you're at 4,280 this morning, that's not a long way from 3,900, right? There's some pain in there for people that would be in gold equities, but we're not giving up here. This is not the time you give up.
04:09 This is the time you add to your positions that you have conviction in. >> And that's what I wanted to get to you a little bit on, that cost average. But before we do that, three weeks ago, you said that the bottom was in. You gave yourself the one condition. You said that the only thing that could break that was Trump doubling down on Iran and you didn't expect that before November because of the midterms.
04:27 Obviously, since then, the US has struck Iran twice in three days. Iran says it hit American facilities in five countries. Regional governments say most of that fire was intercepted. But two super tankers were hit leaving the Strait of Hormuz. Gold closed under 4,330 on Tuesday. So Iran escalated.
04:47 The miners fell harder than the metals did initially. Is the bottom call wrong or does it only just change the timing? >> No, we stick by our call that the bottom is in because I don't think Trump has the ability to do much here other than do what he's done, which I think is minor here in early September, late August.
05:08 He's not going to escalate leading up to the November elections. He can't. And I would feel differently about this whole scenario if the elections weren't happening, but they are. So, you have to deal with the hand you're dealt. And the hand you're dealt is the Republicans need to do better in this upcoming election, and how do they do that when we're blowing up Iran? I just don't see it. And so I think that you're going to see moderation in September or October leading up to the elections, but if he
05:36 doesn't give himself enough of a runway, right, and pulls the plug and says, "Okay, Iran, we're going to back off," you're October 20th. There's no way they're going to win. So, I think that you see some moderation in Iran. And I don't think either party's going to be happy with the outcome, right? And I'm not making that up.
05:56 I believe that this has been a disappointment for the US, but it doesn't mean that they don't escalate again after the elections, right? I think this is going to be an ongoing problem that the market has to contend with. But what happens on the plus side if we do get a resolution, right? You have to look at both sides as an investor. Yeah.
06:15 And obviously the oil market has been all over the place, but looking at the equity specifically on the stock side, you were a net buyer every week in July and August. I think you said your cash went from 12 to 14 at the end of June down to 8 to 10.
06:30 So you spent the powder into that timing. Was the timing wrong or was that just buying a bottom and what it feels like from the inside? >> We can't get the timing perfect. What we teach investors is we start a position in something we have conviction in and then we add to it on dips.
06:50 And this summer is a perfect example, Jeremy. If you look at the beginning of the war, let's call it March 1st to August 1st, the HUI was down around 40%. Which is similar to GDX, right? The large cap gold miners. And in that index, HUI or GDX, Newmont and Barrick are components of that, right? And so if the big caps that are making free cash flow hand over fist are getting hit to that tune, there are some juniors that were getting hit 50, 60, 65% that we were buying, more than half off from the peak. So we're happy to
07:24 do that in the framework of a bull market. >> I've got to ask you about the juniors. Before we do, let's go back to those two companies I talked about because I think the gap between them explains more than the gold price does. Barrick spent 1.19 billion on capital last year. 654 million of that went into projects rather than maintaining the mines it already runs.
07:45 Newmont's sustaining capital was 438 million. Newmont generated that 2.2 billion in free cash flow I showed. Barrick 515. So is that the difference? One company building and one harvesting or is Barrick simply executing worse here? >> I think Barrick is executing worse. We don't own a position in Barrick. It is cheap on the longer term chart, no question.
08:12 But Newmont has been consistently a leader over the years in my opinion along with Agnico, AEM, and so we own those two and they're I think the first and second largest holdings in GDX right now with Barrick being third. And so you want to own the sector, Jeremy, for this very reason, right? And if you just own Newmont versus Barrick, you're going to have two different experiences.
08:34 But if you own GDX, you own a number of companies, dozens of them, and you're playing a directional move in gold miners, right? Because you believe in the free cash flow generation and you believe in a higher gold price. And so GDX, we called a bottom on it at 70 bucks. We were pretty darn close.
08:53 And now it's at 97 or 98 as we record this, right? So you can make money by buying ETFs as core holdings I think as an investor and then sprinkling in juniors around that. We call that a hub and spoke structure. >> Okay. On the juniors, August was one of the strongest months this sector has had in decades.
09:13 Gold up about 9%, big miners were up 33, juniors slightly more than that as you talked about there. Did anything change in August or was that bounce off an oversold market? >> Well, a lot of these stocks had RSIs, relative strength indexes, of 30 right around August 1st. So, we were really oversold.
09:35 August 3rd just started the rally out of nowhere, right? August 5th, you got confirmation from the ADP numbers in the US, which was a really poor read. That was followed August 7th by the non-farm payrolls read, which was a huge miss. Negative 23,000 jobs created when the estimate was a positive 80,000 jobs created.
09:55 That's over a 100,000 jobs off, right? And what I think investors miss is Warsh at the Fed is not just worried about inflation. He has a laundry list of things he's got to look at. And I would argue number two on the list is the labor market. And the labor market is crap right now in the US.
10:14 How do you get excited about job growth like that? So, we're going to see another non-farm payrolls read here September 4th, later this week, Jeremy. And I think if we keep seeing these numbers that are less exciting to the US government, I don't think they have the ability to raise rates at the pace that they're talking about.
10:31 >> Let's go back to the juniors there because there is one question I want. You've said that juniors are rising three times faster than gold is what confirms that bull market and that was your evidence through August, right? They've fallen harder than gold, too, obviously, in that time.
10:50 But what does leverage confirm the thesis on green days and it doesn't invalidate on the red ones? Explain that a little bit. >> Absolutely. It's an important concept for investors to understand. So, if you buy gold at 4,000 an ounce and it goes to 4,400, you're going to make 10%, right? But the miners during that period should go up two or 3x to that move in gold.
11:11 And if they don't, you have to ask why. Like what's wrong with the stock that I own? Or is that company hedging production if they're a producer, right? Because if you're hedging production at a certain cost that could be impacting your upside. And companies do hedge. Let's face it, airlines hedge.
11:30 It's a normal process in investing. But we want to have exposure to companies that are going for it, that are unhedged, right? And so two examples of that would be Denarius Metals, DNRSF in the states and DME in Canada. Serafino has been doing this 40 years. He has very wealthy friends like Frank Giustra, Robert Friedland surrounding him and Denarius, if you look at their news, went after Emerita and offered
11:58 it was like a 13 or 15% premium when the stock was distressed. They didn't accept that, but then they came back and said, "All right, well, here's 73%." And the stock was getting some love from the fact that Serafino is going for it in this market. And then they just took out 15% of a copper giant here in the hottest copper market of all time.
12:19 So I think a company like that is what investors should be looking for: not just what their current revenues are but what are the future revenues when you start seeing a company grow like that. And another one is gold mining. They just had a merger between GoldMining and Goro, which was Gold Resource. GO is the new ticker and that's a listed stock, right? So that's a bigger stock trading at $3.60 when we record this.
12:45 They were added to the Russell 2000 June 30th and then removed from the Russell July 16th or 17th because of that merger and the stock got absolutely smoked. So we brought CEO Reyes on our show and just had him explain what happened. I've never seen anything like that in my entire career where the Russell 2000, a large index, made a mistake like that and basically cratered the stock over 50% in a matter of two weeks.
13:14 So you look for these artificial things happening in the market, Jeremy, within a bull framework and just say, "Hey, I'm going to buy these dips." This is a hot gold market. >> Yeah, it certainly has been. Plenty of those juniors are still well below where they traded even back in March.
13:29 Why hasn't the money properly reached them? But what are you actually looking for in a junior right now? Give me the checklist, not the story. >> Okay, sure. It's always management first. I know CEO Reyes. I know Serafino Iacono. I trust what they're doing. And you have to trust. When I speak at Beaver Creek, the first thing I'm talking about in a couple of weeks is honesty. And if you're lied to as an investor once, that's one thing.
13:57 If you're lied to twice, I have a two strike rule. That's it. I'm out. I'm never going back to anything you're doing, whether you're a CEO or a board member. I'm never touching any other stock that you're involved with. And you have to have a discipline in investing. That's my discipline. So, people first. And I say that, Jeremy, because the project can be great.
14:16 If you have a terrible person running it, it's not going to work. So the project is the second checkbox for us. And I know that's unusual. Most people put project first, but I really believe that people are important and building those relationships is really important. The third thing is kind of a tie between share structure and jurisdiction, right? I want to see a share structure that isn't completely blown out.
14:39 And if it does have a large share count, Jeremy, that's okay. But I want to know where the bodies are buried in that share count, right? If you have 400 million shares out, I need to do a phone call with you as a CEO to understand: do you have 30% of this company locked up so that we're not going to see it taken under as an investor, right? And secondly, do large institutions own positions, right? Does Franklin Templeton have 3%? Does VanEck have 5%, right? I want to see these companies in the share structure so that I have a
15:08 better understanding of the fact that as an investor we're not going to see them do something weird, right? And so jurisdiction as a tied for third is because of the geopolitical backdrop we live in, right Jeremy? This is crazy. You're seeing certain parts of the world like South and Central America getting more compelling actually, like Peru: new elections there, more conservative, more pro-mining.
15:35 Colombia, same thing. I was just in Colombia earlier this year, very pro-mining, new regime that just took over over a month ago. So, you look for things like this and then you do a top down and say, "Okay, if I like Colombia, who do I like in Colombia?" And you start doing some research around that.
15:51 And it's a lot of work. So I say those are my four things that I'm looking for every single time when I make an investment. >> I've got to ask you more about Colombia because it has been interesting watching it from that side. But before we do, just on this, because you've probably backed teams that didn't work before.
16:07 I certainly did when I was on the buy side. But what did you miss about those people the first time around? Any advice for people? >> You can't guard against lying. When someone lies to you, they lie to you and then you have to make an adjustment, right? And the adjustment is you never work with them again. Yeah.
16:22 >> I'm cut and dried. I'm not a gray guy. It's either black or white with me. And that's how I'm successful. Look at my track record on feneckconsulting.com and go to the performance tab. Put it up against anyone else in the industry. I'm very proud of what I've created because I'm decisive.
16:41 I'm not perfect. No one is. But I make decisions and I stick by them. And you learn over time. I'm still learning. I still have been wrong all year and last year and the year before that, right? But you have to take small positions in these where you don't have absolute conviction, right? So we call that taking a calculated bet, right? Part of investing is calculation and you can't always be sure of yourself, but our larger positions, like we're going to talk about hopefully on critical minerals, we've
17:14 talked to these CEOs 30 or 40 times. This is a relationship. >> I'm going to get into the critical minerals. Before we do, just quickly, here's a theory. Tell me if I'm wrong because I always got to show the other side. Junior miners don't live on the gold price. They live on raised money, equity, and debt.
17:32 More than half of America's capital spending growth this year is artificial intelligence buildout, as you know. Those are according to figures from the Fed that he even cited this last week. So obviously that competes for the same dollars. And then we look at the 10-year Treasury now pays about 4.8%, the highest since late 2023.
17:48 So, if money costs almost 5% and there's somewhere more exciting for it to go, does a record gold price actually help an explorer with no revenue? >> It does. In the sense that gold above 4,000 is getting a lot of people interested. And by a lot of people, I mean generalist investors. Some of the people that I used to work with as financial advisors, some hedge funds I know, some private equity groups I know, they're calling me for the first time and saying, "Hey, I saw you on Kitco or YouTube or whatever, and I'm
18:16 interested because I want to get a better understanding of this run in gold equities because of the performance they saw last year." Right, Jeremy? Performance creates interest. And if you don't perform, no one's going to follow you, right? That's why I stay at my computer 14 hours a day.
18:32 I want to make sure that people understand that I'm alongside them as an investor. I'm not just pulling names out of a hat, right? I do the research. >> This is actually a good point. Let's stay on this. We can slow down here a little bit because I get more questions about this than anything else.
18:48 Somebody bought a mining stock back in March. It felt like a sensible amount of money at the time. It's down 40% and now they can't sleep. Not because the story broke, but because they own too much of it. How do you think about sizing a speculative mining position alongside physical metal and cash and other normal equities? >> Yeah.
19:08 Well, first I'll answer what you were getting at there, which is if you can't afford to do something, don't do it, right? If you've made that mistake, take the loss and move on. You can't live on margin and cross your fingers. That's not a strategy. So I always caution people to talk to their financial advisor and make sure that you're not going to ruin your retirement savings.
19:30 This is not a game. This is not a casino. This is real. Secondly, how I size positions is way different than most people I compete with. Like Don Durant, my partner, he is 180 stocks pretty much equal weighted. He goes and just says, "Hey, John, I don't care if it's Gold Group or Denarius or whoever that wins for me.
19:51 I'm just going to take positions in names like those two and 178 others and see where the chips fall." That's definitely a strategy. I don't like equal weighting. I like taking bets. Denarius is over a 2% position for us, and full disclosure, so is Gold Group, GO. So we're not taking a half a percent position and saying that we like this, right? We have conviction in it because we've talked to the companies multiple times.
20:16 So, one of the solutions I would give your listeners is call the companies and get that better feeling for what the near-term looks like and what the long term looks like. And if you can't wait around for the long term, you have to make a decision if you're going to buy, sell, or hold. >> You talk about a core position and a tradable position, with a defined maximum and minimum.
20:38 Walk me through that with real numbers because I think it's the most useful idea in that process there. >> Yeah, sure. So, as we said, hub and spoke structure means that you have conviction in core holdings. That's the hub for us. The hub is — we're not going to show our whole hand on Kitco here, but we have a huge position in silver.
20:56 We have a huge position in GDX and GDXJ. Those are our top holdings, right? And those are our hub. And then we take positions in critical minerals, in gold equities, and in silver equities. Those are our three major buckets. And we use those as spokes. What creates a hub position in there, Jeremy, versus a spoke position is (a) our conviction in the name and (b) whether or not we have any relationship with the company whatsoever.
21:22 Right? Because I do research. I find things in tungsten and antimony and rhenium, things that I don't have a relationship with the company, but the stock looks so cheap I can't help myself. So I have to own it. But when I'm up 100% in something like that, I'm probably going to sell half or all of it because I don't have the relationship, right? I don't know what's next for the company.
21:44 To your point, are they going to do a financing out of left field? I don't want to get caught like that. So I feel like building those relationships on the phone with CEOs is something I do well and it's something that I encourage people to do. >> The question I get too, and I'm sure you do, somebody's down 30, 40% on a junior that they bought in March.
22:04 Average down, hold, sell — what's the test? >> Well, you really have to ask yourself again, was that me getting caught up in a euphoric moment in January, February leading up to March 1st, and then the rug got pulled because of the war? And that has nothing to do with me as an investor, but it happened, right? And you have to acknowledge it happened.
22:26 And if that's the case, then take a loss, right? Or reduce your position. But if you feel like, hey, that company is still going to go into production or get their permits or have some positive catalyst, then you have to stick with it. I'll give you two examples there.
22:44 Stillwater is one that we've owned for a couple of years now. PGEZF in the States and PGE in Canada. I've known Mike for three or four years. I cold-called Mike. I had no relationship with the company. I said, "Hey, you're connected to one of my other stocks, Sibanye, in Montana, and I want to get a better understanding of what you as a junior look like."
23:02 And we formed a great friendship. And that stock just came out with their MRE, their mineral resource estimate, last week. Jeremy, lights out. These guys have more rhodium in the US than any stock that I can find in the junior US market. It's very valuable. Kitco puts up rhodium prices on their homepage, right? It's hard to find.
23:24 They also have platinum, palladium, copper, nickel — all these things are extremely valuable. So, we call that a polymetallic deposit, but it's in the US attached to a major, trading at 29 cents when we record this. When they came out with their MRE, the market really loved it and took it to 37 cents in two days, but now it's right back where it started based on what you talked about, the Iranian back and forth. It's like a joke.
23:48 >> From some of that liquidity, there's people selling into it too. Has the volume picked up in some of these mining stocks over the past little while? >> Yeah. That stock saw massive volume on the back of their MRE. I look for catalysts like MREs, PEAs, PFSs.
24:06 These are milestones for a company. They're really important to look for. Another one that announced in their news that they're coming out with their MRE, you've probably interviewed before or heard of, Power Metallic Mines, which is Terry Lynch. That one's PNPNF in the States and PNPN in Canada. >> Terry, like Mike, is just very high conviction and believes that they're undervalued here because of their copper hits.
24:30 They have a polymetallic deposit as well, but copper is sort of their forward metal and copper's at an all-time high. When you see 10%, 12%, 14% copper hits — show me another junior that's putting these kind of numbers up. I think their MRE is going to be outstanding and I don't think people have long to wait.
24:48 >> What's your hottest copper play right now? I've got to ask you. >> It's that one. Power Metallic. By far, because they have 17 billionaires in the cap structure. It's insane. None of those people are selling on a bad MRE. I can tell you that. So, that's what I was talking about, Jeremy.
25:05 Let's say they have 250 million shares out. You look at that as an investor and say, "Okay, that's a lot of shares." Sure. But then you do the math and you're like, "Wow, half of these shares are tied up in hands that will never sell this at this price." >> The one that nobody's really asked you.
25:21 I went back and watched some of these tapes. What's the worst mining stock you've ever owned and what did it teach you? >> Gosh, I've tried to block it, Jeremy, but it's Allied — symbol was ANV. And like I told you, I've never owned anything that that CEO ever did again, what the IR person ever did again, what the board ever did again.
25:48 And that today is the current Hycroft. Believe it or not. So that just shows you that your timing really matters in investing as well, right? Because Hycroft's been a whole other story with a nickel-looking chart but I never owned Hycroft because of what I learned in Allied. >> Obviously we'll talk your book and we have been talking your book, but obviously you own a lot of these positions. I wanted you to give me three, maybe one producer, one developer, one critical minerals company, and for each one tell
26:20 me what has to happen operationally for it to work. Not what it's worth, but what has to happen at the mine. >> Okay, sure. Well, I'll start with critical minerals. And if you don't mind, I mentioned Guardian Metal last time, which was GMTLF. I just wanted to mention to people that they uplisted, as I expected, to GMTL on the New York Stock Exchange.
26:44 This is an indication that they're going to see a lot more institutional interest, right? We've been in that stock since 2023. It's been one of the biggest home runs of my career. They're in Nevada with two great mines that they put out a PFS on since we last met, Jeremy, June 30th.
27:02 Outstanding numbers, payback in less than a year. If it was a gold or silver stock, people would be buying it hand over fist. But tungsten is one of those things that people don't really understand. So I just wanted to mention that real fast. I wanted to give you two more. One could become a producer faster than people think.
27:17 So it's a development story. That one is Cass Resources, which is basically 70% owned by a shell company on the NASDAQ called Skyline Builders Group, which is symbol KAZR. I know that's a mouthful, but KAZR — I just talked to their chairman for the first time. This guy worked for George Soros for 5 years. He went to Cambridge.
27:39 He's a CFA, super bright guy. And he's like, "John, I'm a chemical engineer by trade. I just saw this opportunity in tungsten and went for it." That's really interesting to me. So their cash cost at that company is $100 to $150 a ton. Tungsten is currently trading over $2,800 a ton and it's not giving any of the price action back, right? So that's a 50-year mine life right there that is fully funded by two huge entities.
28:13 US EXIM Bank, who I'm sure you know, Jeremy, right? And then the DRC. So those two entities have stepped up with $1.6 billion when their capex is $1.1 billion expected. So they have more money than they know what to do with. And this is the opportunity in critical minerals that I keep trying to tell people: show me a gold stock that has $1.
28:36 6 billion lined up right now, right? Gold's super hot, copper super hot. You're not seeing this in other parts of the mining area, but you are seeing it in critical. >> Yeah. >> So those are a couple of stories there for you. A near-term production story in Guardian, a development story in KAZR. And then on the explorer side, I'll give you Western Star, which is a new name, too.
28:59 That's WSRIF in the States, and WSR in Canada. Blake is super hard charging, just like Terry Lynch at Power Metallic. Love that in a CEO. Attending conferences, putting out news like every week. They're in Nevada and New Mexico, two states I really like. And they just put out some sample results.
29:21 Again, not deep drill holes, but sample results in their new Nevada project, which is called Roland, of over 4% tungsten. When you're talking like 3% tungsten, that's more like the global average. So, they have super high grade in Nevada and I'm really excited to see what they're going to do in New Mexico because they're moving a drill rig there right now and put out some news on that this week.
29:44 >> I want to ask you more about tungsten because the critical minerals have certainly been coming across my desk, but silver first. It's your largest position. It's been for what, two or three years? It was 18% of your book at the end of December. It's now 11 to 12.
29:59 Did you sell silver or was that entirely the price moving? >> We did. We did sell some and we came on your show in February and talked about over $100 silver. I'm going to hold true to what I told everyone and I got shelled for it. But we did sell between 100 and 120. We didn't clip it at 121, but we did a good job of reducing our position by about 20%.
30:21 And we're going to buy it back if it gets to 50. Maybe even 55. That's kind of where I think I'll add. But I'm not chasing something that my cost basis is under $17 an ounce. So I don't want to chase a metal that I've followed for years and know how it trades, right? It's very volatile.
30:41 So I'll wait for it. If it comes back down, I'll buy more, but we're very bullish silver. >> Yeah. Silver got added to the critical minerals list last year. There's a shortage of silver. Silver's being used on the industrial side, as you know, and many more things these days.
30:58 So where is the silver coming from, right, when you look at global production? It's usually a byproduct. You don't have many pure silver plays like First Majestic, AG, or some of these stocks, right? A lot of them are 20 to 30% silver. >> AG, bring up First Majestic. You think about Keith. Is that kind of your favorite play in that area? Any juniors you like on that side? >> I own Keith's stock through GDX and GDXJ.
31:28 I don't own it outright right now just because of the valuation versus other things that I'm seeing. But I've known Keith since 2008 and he's done a great job and obviously comes on your show a lot. And on the silver side for juniors, the one that I'm most interested in right now is one that's going to start drilling in Utah which is called Triumph Gold.
31:50 It's TIGCF in the States and TIG in Canada. John's a really interesting leader. He's got two million ounces of gold, by the way, in Canada with tungsten and antimony literally at surface. But the silver project he bought in Utah for a song last year he's going to start drilling this fall. And they're probably 60 to 70 miles away from the established camp.
32:15 So we'll see if it's on the same trend or not. It's a spec bet at this point on their silver, but they have very established critical minerals and gold. So, we like investing in companies like that that have multiple ways to win. >> I usually see you at some of these conferences, too.
32:31 You're talking about gold, silver. Obviously, you've been talking tungsten. I've got to ask you, you've talked to the US government three times this year about tungsten. What does a meeting like that actually look like? Who's in the room? What'd you find out? >> Yeah.
32:48 So, I got into the conference business begrudgingly about three years ago. And in doing that, one of my speakers in Washington DC in May was working for the US government through the SAFE division, SAFE. And I went up to her afterwards and just said, "Hey, great presentation. I'd like to learn more about what you guys do."
33:09 And she's like, "Yeah, you had a great presentation right before me and I'd like to learn more about what you're doing and what companies you follow." So that's what started that first Zoom back in June. And we've done two other Zooms since then to really talk about how there's a disconnect in the US, Jeremy, of "hey, we need all these critical minerals, but we don't have any permitting going on."
33:29 Like, what the heck is going on here? Why are Trump's sons investing overseas in critical minerals deals? Why aren't they investing here? Right? I think Trump's done a tremendous job of creating awareness last year through his March and April EOs and fast-tracking, right? But we have a long way to go.
33:48 A long way. And that's why I'm so interested in tungsten because in talking to this person and her staff — I've talked to four different people now. They all say the same thing, Jeremy: we're a year and a half to two-year deficit in tungsten right now. So for all the naysayers that say, "John, the price is at 2,800.
34:04 It was at 920 earlier this year." Yeah, I agree. That's a big move, but you have to understand the dynamics and why the move happened, right? There is no ETF tracker in tungsten. There is no futures market in tungsten. You have to buy tungsten equities like KAZR and WSRIF, right? That's what you do.
34:24 And so 17 plus percent of my portfolio right now is in tungsten equities. >> Interesting. So the contradiction there is obviously Washington says these minerals are a national security priority, but it takes years to permit one at home. Does the US actually want a domestic supply chain or does it just want the supply? >> Both. Yeah, they want both.
34:46 So you're going to see something like KAZR — they flew over to meet the US government last year to meet with them and say, "Hey, we want to not support necessarily China, Russia, North Korea, right? We want to help you," meaning the US. So those are considered to be like offtake conversations, right? They're not definitive. Nothing's been done yet.
35:10 But I'm seeing that in a lot of critical mineral stocks as I'm sure you are, Jeremy, where an offtake agreement for 25 million, offtake agreement for 100 million — these are big deals because it's tying up future production, right? It gives you as an investor much more comfort, right, that there is a buyer on the other end for what this company is trying to produce. >> China controls most of the processing as you know, so a western company can dig tungsten out of
35:39 the ground and still maybe not be able to sell it. Does the West actually have a mining problem here or a refining problem? >> Both. We don't have refineries. We have some but it takes a lot of capital to build them and permit them. And that's my thinking, Jeremy, and I could be wrong on this, but my thesis is that the US will start building refineries, smelters, things like that over the next couple of years in our own country, not just build joint ventures with other countries to have
36:16 partnerships per se, because this is not just a defense thing. We both know that tungsten is used in tanks, in Tomahawk missiles. You can't make these things without tungsten. It's an irreplaceable metal. Tungsten is heavily used in technology. And if you look at what's happened this year, the most telling thing to me, which I think I mentioned to you in February, was that Japan got cut off at the knees by China January 1st and then they got cut off at the knees again this summer.
36:43 So, when you're looking at companies like Samsung that are major Japanese conglomerates, right, that are saying, "Hey, we're running out of material, where's it coming from?" That's the $64,000 question. >> Obviously, most people watching this don't just own the metals. Maybe some don't own some of those stocks.
37:02 I know you watch the equity side. A lot of these people, they've got retirement accounts full of index funds. You expect still a 15 to 20% off the S&P by first quarter of next year. But one widely used measure of corporate profit margins just reached their highest on record.
37:18 The data going back to the 40s. Credit spreads are tight. It feels like this is a market that maybe could fall but it hasn't. What breaks it in your mind? >> The AI tech trade for sure. I've been doing this a long time, longer than I'm going to admit to anyone here on this show.
37:38 But I will say that March of 2009 to now, that rally is long in the tooth and we are going to see a sector rotation between now and March. That's my call. And people are going to be less interested in tech, AI and momentum and more interested in value stocks like some of the ones you mentioned at the onset in Newmont and Barrick.
38:01 >> So that rotation takes place, maybe the people sitting there holding some of these haircuts on the mining side should just sit and hold, wait for this next cycle. >> Absolutely. We always encourage people to work with their financial adviser or their tax advisor to think about holding for a year so that you get a long-term cap gain or a long-term loss, right? But this is not the time you sell when you've got most of this selling this summer predicated by the Fed and by the war, right? These aren't things that we
38:32 sit around and worry about at Feneck Consulting because the Fed only has so much they can do in my opinion and the war is temporary. This is not going to be Russia-Ukraine. It's not going to be a four and a half year endeavor in my opinion. >> What a year. What a year it's been. Hey John. All right, John Feneck.
38:50 Feneck Consulting Group. Genuinely useful. Thanks for your time. I appreciate it. I'm sure I'll see you on the road at some point here. >> Love to. Thanks, Jeremy. >> All right, that's John Feneck from Feneck Consulting Group. Now, here's where things sit as we go out. Gold sitting here on the day and not too bad.
39:08 4,370 between that and 4,378. Silver also up. Platinum, palladium, both also higher. Rhodium quoted up as well. Now, the August jobs report lands this Friday morning at 8:30 Eastern. Consumer prices follow on the 11th. The Fed meets on the 15th and the 16th with new projections attached. So, I want to know:
39:24 are you buying juniors down here? Are you waiting? Tell me in the comments. I do read them. And if you're new here, this is what we do. Long conversations with people who put their money into this. Be sure to subscribe right here to Kitco News. I'm Jeremy Szafron. Thanks for watching.