Issue link: http://resourceworld.uberflip.com/i/734523
o c t o b e r / n o v e m b e r 2 0 1 6 www.resourceworld.com 5 e d i t o r ' s c o m m e n t s Ellsworth Dickson ellsworth Dickson, Editor-in-Chief email: editor@resourceworld.com t: 604 484 3800 | 1 877 484 3800 F ollowing the TSX Venture Exchange low on January 28, there was a great upswing in share prices of mining stocks; however, now stock markets seem to be just biding time not knowing exactly what to do. There has been recent, sudden, billion- dollar gold selling action on the futures market and a couple of jaw-dropping days on the NYSE and the TSX – and quick recoveries. Canada and its two major stock exchanges – the TSX and the Venture Exchange – may be resource-heavy with Canada a mining and energy leader, but those exchanges are subject to the vagaries of what happens to its giant neighbour to the south. Just how much influence does the Clinton-Trump election have on stock markets? I understand that historically, a Democrat win is good for stock markets while a Republican win is bad for the markets. Then throw in massive gold and sil- ver buying/selling, geopolitical events, changing commodity prices, commodity supply/demand, high frequency algo- rithmic trading, possible Federal Reserve decisions and, probably most important of all – mass psychology – and it's pretty difficult to ascertain where the market will go. For example, the four years before February of this year saw many quality mining stocks so grossly undervalued that, while their fundamentals looked great, the market didn't care. But now, after a great eight-month run, we have uncertainly and volatility. While we can accurately predict that the lights will be going on this evening on Broadway and our car will start tomorrow morning, forecasting what will happen on the stock market is a different matter as the future is basically unknowable. Under these unnerving circumstances, what should a mining stock investor do? It would make sense to me that in addi- tion to the more higher risk mining stocks out there that show promise, an investor might want to choose some companies that have significantly de-risked themselves by just being what they are. In other words, they have the Minerals, Management and Money. Sprott's Rick Rule, a spectacularly suc- cessful mining stock investor, recently said, "Concentrating your portfolio on the best 1% of the issuers is the sort of thing that you need to do to get ahead in this market." Sounds like good advice to me. The Gold Eagle Newsletter's AG Thorson mentioned something interesting in his recent post. He wrote, "The arguments against owning physical gold have been washed away with real negative interest rates. One key argument was that owners of gold do not get paid any interest. Well, earning no interest is better than paying someone to hold your money as it loses purchasing power." Several gold analysts that I follow are confident that the stalled gold price is temporary and the fundamentals remain in place for the young gold bull market to resume its upward climb. Then again, cash is a position too. n What's next? Nerve-rattling volatility and uncertainty haunts stock exchanges