Rick Rule — "Commodity Weakness Is Coming, Here's What to Buy": near-term bearish, long-term very bullish, and buying because of it

Agnico Eagle is one of the world's three biggest gold miners. Rule's case for it is not about gold at all — it is about who has spent shareholders' money well. Mining is a business that consumes itself: every ounce you dig is an ounce you no longer own, so the only thing that keeps a miner alive over decades is buying and finding replacement ounces at sensible prices. Judged on that single test over thirty years against its two direct peers, "first, second, and third all belong to Agnico. They've done such a better job that there's no comparison."

The behaviour that produces the record is countercyclical. Agnico bought and drilled through the years when gold was unloved and everyone else was cutting, so today, with gold high and every rival hunting for growth, "they don't need to make overpriced acquisitions." That is the reverse of the industry's normal cycle, in which miners buy at the top and write the purchases off at the bottom.

He adds an unusual second argument, about labour. Agnico's employee turnover is about a third of its peers'. Lower turnover means lower recruiting and training costs and — because inexperienced miners get hurt more often — a lower injury bill. And he names a mispricing: investors pay a premium for gold produced in Nevada simply because it is a famous, comfortable address, while Agnico's Canadian Abitibi belt, in his view no worse geologically or logistically, gets no such premium. This is his "beta" recommendation: the name for someone who wants gold exposure without doing company-by-company work.

Equinox has recently swallowed two other miners, Calibre and Orla. Rule's reason for recommending it now is not a new mine or a new number — it is that he can identify exactly who is selling the stock and why they will stop. Many people owned Calibre and Orla shares as a bet that the companies would be taken over. The takeover happened. The bet paid, the reason to hold vanished, and those holders sold their new Equinox shares indiscriminately. "This is a hiatus."

What has to happen next is a swap of shareholder types: sellers who wanted a deal have to be replaced by buyers who want the combined business, one they judge "worth more than the price of the constituent parts." That transition depresses a share price for months without anything being wrong operationally — which is precisely the window he is pointing at.

Underneath it, real things are improving. A key hard-rock mine is being pushed to full designed output (nameplate capacity), the Valentine mine's capacity is being expanded, and the two acquisitions came with development projects. Then the recycling: he expects Equinox to sell a couple of second- and third-tier mines and put the proceeds into another top-tier one — the model Ross Beaty has run for forty years. His closing note is half joke, half timing call: Beaty only pretends to be retired, and stops pretending when the BC rain returns in late September.

This is the deliberately dangerous one, and Rule leads with the loss rather than the gain: if his exploration thesis is wrong, buyers "are going to lose 50% of their money." He says it twice, unprompted. Talon is not really a mining company yet — it is a bet on what is under the ground at Tamarack in Minnesota, a nickel-copper project it holds in joint venture with Rio Tinto.

The upside case rests on a comparison and a provenance. The deposit could be "as profound, perhaps more profound, than Voisey's Bay" — the Labrador nickel discovery that made fortunes in the 1990s — and the person who put it in front of him is the same person who put Voisey's Bay in front of him decades ago. Rule flags his own conditional immediately: "notice that I began that statement with the word if."

Two things make him willing to take the bet. Rio Tinto's involvement means a major mining company has looked at the geology and stayed. And the Lundin family owns about 20% — what he calls "adult supervision," meaning owners with enough money at stake to stop management doing something foolish. He is explicit about who this is for: people technically sophisticated enough to judge drill results, using money whose total loss would not affect a child's education or what they eat for breakfast. In his framework this is alpha, and he has just spent the previous ten minutes saying most people should skip alpha entirely.

Sprott runs about sixty funds and trusts that hold gold, silver, uranium and mining shares. Rule's argument is the simplest in the episode and has nothing to do with any commodity forecast: if you buy one of those funds, you pay Sprott a management fee every year. If you buy the shares of Sprott itself, you own a slice of the fees paid by everybody else in all sixty products — and Sprott pays you a dividend out of them. "Would you rather pay fees or would you rather receive a dividend?"

The leverage is that fee income rises with assets under management, and assets under management rise both when commodity prices go up and when new money arrives chasing them. So the parent company captures the resource bull market twice over, without any single mine being able to flood, miss, or get expropriated.

He then agrees with a takeover thesis the host raises. Nearly every large asset manager spent the last decade shutting down its commodities business. If the resource bull market is real, at least one of them will want that capability back — and building one from scratch would take "10 years and billions of dollars," against simply buying "the best brand in the natural resources business." He owns just under 10% and has only ever sold to stay under the disclosure threshold. Characteristically, he hopes it does not happen — "I've watched big financial services companies mangle their acquisitions" — while admitting that at a high enough price he would take the money.

Last year Rule shocked this audience by recommending the largest, dullest oil company on the board, and it returned 45%. He still likes it, and the reasoning is a piece of honest self-limitation: most people watching will not read reserve reports or drill results, and without that work small speculative energy stocks are a coin flip. So he offers the version that does not require the work.

The concept is beta — the return you get simply from being in a sector that outperforms, as opposed to alpha, the extra return from picking the right individual company. His claim is that in a genuine energy bull market the sector-wide return alone is enough: "by 2030, 2031, you will have made enough buying the beta that you don't need to buy the alpha."

Exxon is his choice of beta for two reasons that connect to his broader oil thesis. It has a thirty-year record of allocating capital well, and — unlike most of the industry, which has been starving its fields to fund dividends and buybacks — it has kept spending the money required simply to maintain production. Since Rule's structural shortage call for 2029-31 is built precisely on everyone else failing to spend that money, Exxon is one of the companies that ends up on the right side of the shortage rather than the wrong one. The Guyana discovery is a bonus large enough to matter even at Exxon's scale.

A royalty company owns the right to a small slice of a mine's revenue without operating the mine, paying for its construction, or absorbing cost overruns. Rule helped found both EMX and Elemental Altus, has been involved with them for twenty years, and when they merged last November he took shares in the combined company rather than cashing out.

His case for the merger is unglamorous and worth understanding because he applies it repeatedly. First, two head offices become one, so a chunk of overhead simply disappears. Second, the combined portfolio is larger and more diversified, so one bad royalty matters less. Third — and this is the part most people miss — a bigger company gets bought by index funds.

That last point is a real, mechanical source of demand. Index and exchange-traded funds buy shares according to size and trading liquidity, not according to whether a business is good. Below a certain market capitalisation a company is invisible to them; above it, money arrives automatically every time someone contributes to a retirement account. Combining two mid-sized companies can therefore lift the pair over the threshold and create buyers that neither had alone. It is the same logic he uses on Equinox and on takeover targets generally: "two plus two equals five and a half or something."

Nations Royalty is a First Nations-led royalty company. It started when the Nisga'a Nation of northern British Columbia took the royalties and impact-benefit agreements it had negotiated over mines on its territory and put them into a publicly traded company, keeping control. Rule is a shareholder and says so before saying anything else.

His investment reason is a competitive one, and he names it bluntly — "greed." Royalty companies normally acquire royalties in auctions, where competing bidders drive the price up and the returns down. Nations Royalty can approach First Nations communities directly, as a company they own and run, and create new royalties without ever entering an auction. That is what he means by a "durable competitive advantage": not being better at bidding, but not having to bid.

The existing portfolio already works — royalties over the KSM, Brucejack and Kitsault properties, with Brucejack having pushed the company past cash-flow-positive to quarterly profitability. Growth means consolidating royalties held by the neighbouring Tahltan Nation and then reaching the Abitibi belt in Ontario and Quebec. The bottleneck is not appetite but expertise: valuing a royalty and negotiating its sale requires financial and technical staff most communities have not had, so part of the company's work is helping build that capacity first. Deals therefore take a long time — which is also why nobody else is competing for them. He is careful to size it correctly: compare it with other small, third-tier royalty companies, not with the giants.

This is a single-asset bet on a heavy-oil field called Blackrod in north-eastern Alberta, holding roughly 700 million barrels, and Rule has been watching that specific piece of ground for thirty years — since a previous owner held it. That is the sort of edge he means when he talks about a fifty-year rolodex.

Two features of the asset make the economics unusual. It depletes slowly relative to its size, so unlike a shale well — which gives up most of its oil in the first eighteen months and demands constant redrilling — the production does not evaporate if spending pauses. And more capital can be added to it at attractive rates of return, so the company can grow without buying anything. Meanwhile it hands surplus cash back to shareholders, which he expects to continue for a structural reason rather than a promise: the Lundin family are themselves the largest shareholders, so distributions to shareholders are distributions to management.

He prefers it to Athabasca on a practical ground rather than a quality one — one asset can actually be modelled, where eight or ten cannot. His timing advice splits by horizon and is unusually specific. If you hold for five or six years, buy it now: "absolutely positively yes." If you trade, wait, because a ceasefire in the Gulf would release the demand that high prices destroyed and "kick the oil price in the teeth" in the short run. He takes that near-term risk himself because his conviction sits on the 2030 price, not the 2026 one.

Vizsla owns one of the best undeveloped silver deposits on earth — about 300 million ounces, high grade, and shaped in a way that makes it cheap to mine — in Sinaloa, Mexico. Rule is a large shareholder, partly for the deposit and partly for the man running it, Craig Parry, who years ago put him into NexGen at 30 or 40 cents.

The rest of the answer is the reason the stock is cheap, and it is not a financial risk. Rule's account: for years most miners in Sinaloa had a working accommodation with the cartel that actually controls the ground, because there was no alternative. When the US took Guzmán, the cartel split into at least two factions and that accommodation broke. One faction attempted to open its own negotiation with Vizsla — and, in his words, "negotiated among other ways by kidnapping 10 employees of Vizsla and murdering them." He notes, carefully, that the company has since been able to hire local replacements. The Mexican saying he quotes is "plata o plomo" — silver or lead; take the payment or take the bullet.

Asked the obvious question — why not buy silver somewhere safer — his answer is that deposits of this quality are not substitutable: "Would I prefer that this deposit be in Nevada? Yes, ma'am. But it isn't." He also explains what a resolution will look like, because it will never be announced: no company will ever publish a release saying it reached terms with the people who killed its staff. What you will see instead is an announcement of financing and permits for major construction — which, in his reading, is the same news in acceptable language. If that arrives, he thinks the stock could be a five- or ten-bagger. "That's an if."

Tin is the quiet metal in every electronic device — it is what solder is made of, so it joins essentially every component on every circuit board. Rule thinks the market underrates how much high-tech demand actually rests on it, and that demand keeps growing. Alphamin operates what he calls the highest-quality tin mine in the world, with substantial exploration ground still untested around it.

It is in north-eastern Democratic Republic of Congo. He does not soften what that means: "a terrifying place of a terrifying country," and he describes the political risk he has accepted as "insane, literally insane." The single most vivid illustration is logistics — the mine's concentrate travels by road, and each truck carries six or seven hundred thousand dollars of product through a region "where people will murder other people for $200," alongside the M23 insurgency.

What makes this a Positive rather than a cautionary tale is a number that has already been banked. He has held the stock for fifteen years and his annual dividends now exceed what he originally paid for the shares. In other words the position has returned its entire cost every year, and everything from here is free. That is the payoff structure he is describing when he says a very risky jurisdiction can be worth it if the prize is large enough — and why, asked whether there is a safe tin play instead, the answer is simply "not of this quality."

Copper Giant holds a very large copper porphyry in Colombia — porphyry being the low-grade, enormous-tonnage deposit type that supplies most of the world's copper. Rule owns it, and the two reasons he gives are the deposit's size and the persistence of its backer, Frank Giustra, whom he has watched develop resources for forty years.

He is equally direct about the two costs. Proving up a porphyry means drilling an enormous amount of very expensive holes — "not something for small folks" — so the company will have to keep raising money, which dilutes existing shareholders. And the ground sits in the Páramo region, a poor, thinly-governed part of Colombia extending into Ecuador where the border is porous and armed groups move freely.

What makes this entry useful is how he closes it, because it is a suitability screen rather than a rating: "highly risky. People who can't afford to take speculative risks should look elsewhere." He is not arguing anyone else should own it. He is explaining why he does — a size of prize that justifies a specific, named set of risks he is personally equipped to carry.

Dundee is a merchant bank for the mining industry. Rather than digging anything itself, it puts large amounts of capital into junior companies at the hardest moment in their life — the jump from "we have found something" to "we are producing" — and then supplies what Rule calls "adult supervision": experienced people who make sure the money is spent properly. He compares the role directly to what the Lundin family does at International Petroleum.

His attachment runs four decades and three generations. Ned Goodman mentored him in his twenties; Ned's son Jonathan now runs the company; the grandson is there too. He has partnered with them on real outcomes, including grooming Reunion Gold before its sale to G Mining. He has done very well on the stock and has not sold a share.

The interesting part is where he stops. Dundee appears to want to become an actual mining operator rather than a financier. Rule has seen the family do exactly that once before — International Corona was built, sold to Homestake, and its proceeds spun into Dundee, which then created Dundee Precious Metals — so he grants that it is possible. He simply refuses to underwrite it in advance: "I reserve my comment on that until I see how they proposed to effect that strategy," and the sentence he repeats twice is "they're more useful to me as a merchant bank." Financing companies and operating mines are different businesses with different skills, and a good track record at one is not evidence about the other. He stays in the stock, watching. "If they show me that they can make me more money as a miner, God bless."

Rule owns "a fair bit of gold" and wants considerably more, which is exactly why he is pleased to expect a soft price for the rest of the year. His analogy does the work: everyone shops for clothes on sale, yet with financial assets "people seem to want to pay more." He is a buyer, so cheaper is better, and he says so without hedging.

The long-term case is not really a forecast about gold — it is a forecast about the dollar. He expects the US dollar to lose as much as 75% of its purchasing power over ten years, as it did in the 1970s, and he expects the dollar price of gold to rise roughly in mirror image. Gold does not become more valuable; the yardstick shrinks.

The most useful part is what he says does not drive gold. Despite an active Middle East war, "gold is remarkably resilient to conflict." What moves it is loss of faith in the currency plus negative real interest rates — a term worth unpacking. If a ten-year government bond pays 4.6% while the currency is losing 8-10% of its purchasing power a year, you are not earning 4.6%; you are losing three or four percent in real terms with certainty. When the safe place to store money is guaranteed to shrink, gold's lack of a yield stops being a disadvantage. That, not headlines, is the condition he watches — and it is the condition he expects to intensify once rates are politically forced down after 2026.

The most transferable idea in this interview is a distinction between two kinds of shortage. Oil at $90 with the Strait of Hormuz closed since March is an artificial shortage: nothing is wrong with the world's ability to produce oil, the barrels are simply blocked by politics and war. A shortage like that "could be solved by an armistice" — one diplomatic event can undo it, and the price collapses.

He also explains why $90 rather than $200. High prices destroyed demand, though not visibly in rich countries: a Toronto driver grumbles and fills the tank anyway, while a taxi driver in Colombo simply parks the car. On top of that the world drew on enormous buffers — oil floating on tankers, the US Strategic Petroleum Reserve "being drained at a very rapid rate," Chinese and Japanese stockpiles — plus flexible US production and the substitution of liquefied natural gas. Those buffers are finite, and as they run down the price starts reflecting an actual rather than an anticipated shortage.

The second shortage is different in kind. For years the industry — especially state-owned producers — has underspent on the routine maintenance capital required simply to keep existing fields producing, by more than a billion dollars a day, and that gap compounds. His conclusion: around 2029-2031 the world faces a structural shortage, "and we won't be able to end that shortage with an armistice." No political event fixes wells that were never drilled. That is the shortage he is positioning for, and why he will tolerate a bad oil price next year. He also dismisses the peak-demand forecasts that justified the underinvestment: "they were wrong. They were simply wrong."

Rule discloses immediately that he does not own this one, and the reason turns out to be about his own process rather than the company. Athabasca has eight or ten different assets, each needing its own production profile, cost structure and capital plan before you can build an earnings model. International Petroleum has essentially one. He prefers the one he can model — a preference about analysis, not quality. He calls Athabasca "also attractive."

Where he goes further than the host is on takeovers. Asked whether it might get bought, he answers that he regards it as "icing on the cake, but I also regard it as inevitable." His reasoning is structural and applies well beyond this stock. Bigger companies trade more shares each day, which attracts index and exchange-traded funds that buy mechanically; that steady bid supports the share price, and a higher share price means cheaper equity. So scale itself lowers the cost of capital, and a large company can therefore pay more for an asset than a small company can — which makes buying the small company rational for the buyer and profitable for its shareholders.

He offers ARC Resources as the pattern: for a long time his favourite Canadian oil equity, having competed against them for thirty years, and Shell reached the same conclusion he had. His view here is genuinely two-sided — an attractive, capital-efficient business with a broad asset base and a plausible bid, that he nonetheless has not bought.

On a rapid-fire question Rule gives Solaris the two ticks he usually cares most about — "I like the people. I like the deposit" — and then withholds a recommendation on a third criterion entirely: whether the deposit can actually be permitted and built.

He is careful to distinguish real opposition from manufactured opposition, and says this is the real kind: "there are real social and political challenges that they face, not fake ones — local opposition." Anyone considering the stock, he says, has to go and understand that situation themselves rather than take a company presentation's word for it.

The specific risk he names is subtler than hostility, and it is a genuinely useful lens. The problem is capacity: the local population that has to decide the project's fate does not have the technical and administrative resources to evaluate what it is being offered, and "you run the risk that a population that doesn't have sufficient capacity will make a poor decision." A community can reject a project that would have benefited it simply because nobody on its side of the table could assess the terms. That is the same insight underneath his enthusiasm for Nations Royalty, which exists partly to build exactly that capacity. Here it produces no ownership and no call.

Abaxx is trying to build a commodity exchange in Singapore where contracts settle in the actual physical material rather than in cash — for things like battery metals and liquefied natural gas. It has been the subject of a short report, and the stock has not recovered.

Rule splits the question into three and answers only two. On the founder, Josh Crumb, he is positive: a long-standing and formidable competitor in the gold business whom he likes and respects. On the idea, he is positive too — more technological competition among exchanges is good, and doing it under Singapore's "much less politicized regulatory environment" is sensible.

On the actual investment case he refuses, and the refusal is the most valuable thing in the segment: "my track record in science and technology is unblemished by success." That is a joke with a real edge — he tried to be a technology investor in his thirties and was, in his words, amazed at his lack of success. So he will not judge Abaxx's technology and, notably, he did not defend the company against the short report either, because he cannot evaluate the claims. He contrasts it with a short attack on a silver company that he did take on, where he genuinely knew more than the sellers. The offer he makes instead is to interview Crumb publicly so a competent audience can judge the rebuttal. As the host summarises it: "that's how you get success — knowing what you're not good at."