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1. Gold has traded between $1,493 and $1,505 so far today…as of 7:00 am Pacific, bullion is up $7 an ounce at $1,501 following yesterday’s Fed decision and Jerome Powell’s “We don’t know” news conference…Fed credibility continues to wane and that’s bullish for Gold…Silver has added 11 cents to $17.83…an exceptionally strong support band for Silver exists between $17.75 and $17.25…Nickel has gained 3 cents to $7.88…Copper and Zinc are each off a penny at $2.61 and $1.04, respectively, while Cobalt is steady at $16.56…Crude Oil is 67 cents higher at $58.78 while the U.S. Dollar Index has slipped one quarter of a point to 98.28…Fed Chairman Jerome Powell left the door open to additional cuts and repeatedly cited the costs of trade uncertainty in his post-statement news conference yesterday…however, central bank officials were split over the decision and the outlook for further reductions…“There will come a time, I suspect, when we think we’ve done enough. But there may also come a time when the economy worsens and we would then have to cut more aggressively,” Powell stated…“We don’t know”…President Trump tweeted, “Jay Powell and the Federal Reserve Fail Again. No ‘guts’, no sense, no vision! A terrible communicator!”…previously (he may attempt this again), Trump has ratcheted up the trade battle with China to squeeze the Fed further when it comes to interest rate cuts (lower interest rates, in his view, outweigh any negative short-term affects of difficult trade negotiations designed to fix a relationship that has been badly out of whack for many years)…Justin Trudeau’s problems continue to grow…Global News in Vancouver has released video this morning showing Trudeau in blackface, the 3rd instance of racist dress to come to light in 12 hours…it’s not clear when or where the video was taken, but the video, obtained exclusively by Global News, shows Trudeau covered in what appears to be dark makeup and raising his hands in the air while laughing, sticking his tongue out and making faces…it does not appear the video was shot at the same time and place of the other photos of Trudeau in racist make-up that have suddenly emerged…the resource sector would certainly cheer a change of government at the federal level, a scenario that now appears increasingly likely following the first week of the election campaign…
2. Gold and Oil bulls love this kind of talk: Iran warned today that an “all-out war” could break out if any country attacks it following weekend bombings of Saudi Arabia’s Oil facilities that the U.S. and some allies believe Tehran orchestrated…earlier this week Saudi Arabia set out a timeline for a resumption of full operations at its Oil facilities, saying it had restored supplies to customers at levels prior to the attacks by drawing from its inventories…it said it would restore its lost production by the end of this month, and bring its output capacity back to 12 million barrels per day by the end of November…however, these plans suggest Saudi Arabia will have no spare capacity for at least the next 2-and-a-half months and therefore no way to absorb any further shocks…Saudi Arabia, the world’s leading Oil exporter, has said the attack on its Oil sites was “unquestionably sponsored” by regional rival Iran…a risk premium has come back into Crude…given how easy it now appears to be to damage Oil infrastructure and disrupt supplies (drones attacked Saudi Arabia), especially in volatile areas of the world, it’s insane that Canada would not do all that it could to produce and deliver as much Crude as possible to the world…the Oil-hating “save the planet” left wing mob is a threat to this country’s economic future…
3. U.S. and China deputy trade negotiators resumed face-to-face talks this morning for the first time in nearly 2 months as the world’s 2 largest economies try to bridge deep policy differences and find a way out of a bitter and protracted trade battle…negotiations today and tomorrow are aimed at laying the groundwork for high-level talks in early October that will determine whether the 2 countries are working towards a solution or are headed for new and higher tariffs on each other’s goods…a delegation of about 30 Chinese officials, led by Vice Finance Minister Liao Min, sat down with the American side this morning at the U.S. Trade Representative’s (USTR) office near the White House…the discussions are likely to focus heavily on agriculture, including U.S. demands that China substantially increase purchases of American soybeans and other farm commodities…2 negotiating sessions over the 2 days will cover agricultural issues, according to sources, while just 1 will be devoted to texts covering core changes to strengthen China’s intellectual property protections and end the forced transfer of U.S. technology to Chinese firms…1 of these sessions also will include a focus on President Trump’s demand that China cut off shipments of the synthetic opioid fentanyl to the United States…Trump is eager to provide new export opportunities for U.S. farmers, a key political constituency for the President…
4. The trade tiff between the United States and China has plunged global growth to its lowest levels in a decade, according to the Paris-based Organization For Economic Cooperation and Development…the OECD says the global economy risks entering a new, lasting low-growth phase if governments continue to dither over how to respond (the OECD is focused a lot on trade, but bloated governments around the world need to implement more pro-growth fiscal policies such as lower taxes and regulatory rollbacks)…the global economy this year will see its weakest growth since the 2008-2009 financial crisis, slowing from 3.6% in 2018 to 2.9% this year before a predicted 3% in 2020, the OECD said…the OECD’s outlook has taken a turn for the worse since it last updated its forecasts in May…“The global order that regulated trade is gone and we are in a new era of less certain, more bilateral and sometimes assertive trade relations”…trade growth, which the OECD says had been the motor of the global recovery after the financial crisis, has fallen from 5% in 2017 into negative territory now…meanwhile, it blames trade tensions for weighing down business confidence with global investment growth down from 4% 2 years ago to only 1%…
5. Newmont Goldcorp (NEM, NYSE), the world’s top Gold producer, says it offered $25 million in community investments and land rental fees to resolve a conflict at its Penasquito mine in Mexico, but activists say they are unsatisfied…operations at the open-pit mine located in northern Zacatecas state, which produced 272,000 ounces of Gold last year, have been suspended since last weekend because of a blockade by protesters…“We have made a very generous offer of social investment, but the blockade leaders are demanding hundreds of millions of dollars in cash for themselves,” stated Michael Harvey, director of external relations for Newmont Goldcorp Mexico…Felipe Pinedo, a local leader who has helped organize blockades of the mine in the past, denied Harvey’s allegation in a phone interview with Reuters…“The problem isn’t an issue of money; it’s an issue of life,” said Pinedo…“The people here are clear: They will accept the projects but give us back our water”…he argued that the company’s spending in the surrounding Cedros community was a fraction of the profits from the mine that leave Mexico…the Newmont Goldcorp proposal put forward at negotiations with the community include a 30-year pledge to operate a water treatment plant, a 12-year deal to lease local land and the promise to invest in a production or infrastructure project, the company said in a statement…the mine directly employs more than 6,500 people, including 315 local residents, the company added…Penasquito accounts for about 17% of Newmont Goldcorp’s net asset value, according to a Scotiabank estimate from earlier this year…operations at the mine have been intermittent since March due to protests…some protest leaders said they wanted payment to compensate for damage to the local water supply…the mine was part of the portfolio of Goldcorp, whose acquisition by Newmont was completed in April to form the world’s biggest Gold producer…
6. The Dow is up 69 points through the first 30 minutes of trading…the S&P 500 has drawn close to a new record high as gains in Microsoft, AT&T and other technology companies offset what many investors considered an underwhelming decision by the Federal Reserve in the prior session…in Toronto, the TSX is up 56 points with Gold stocks leading the way…the Venture is off 1 point at 584…Garibaldi Resources (GGI, TSX-V) has confirmed a technical breakout above importance resistance in the low $1.80’s as a series of key drill holes go into the Upper, Lower and “Lower Lower” Discovery zones at Nickel Mountain…Canada Cobalt (CCW, TSX-V) has opened 3 cents higher at 30 cents…hot on the heels of a recently completed financing, CCW is now ready to unleash a series of initiatives at its Castle mine and property in the Northern Ontario Silver-Cobalt where it’s the only company with underground access and an environmentally friendly tailings opportunity that has district-wide potential…Benchmark Metals (BNCH, TSX-V) has closed its business combination with PPM Phoenix Precious Metals Corp., thereby completing the acquisition of a 100% interest in the Lawyers Gold-Silver Project in north-central British Columbia…Benchmark made a cash payment of $250,000 and issued 12 million common shares to the former shareholders of PPM…
7. Amex Exploration (AMX, TSX-V) is up in early trading after releasing more encouraging drill results from the Gratien Gold zone at its Perron Property in northwest Quebec near Rouyn-Noranda, including 16.5 g/t Au over 14.6 m…4.9 m of that interval featured 47.7 g/t…the company has completed approximately 27,000 m during of its previously announced 25,000 m 2019 drilling campaign, and plans to drill an additional 15,000 m through the balance of the year for a planned total of 40,000 m using 2 drill rigs…this continued drilling will focus on expanding the Eastern Gold Zone (EGZ), the Gratien Gold Zone and the Grey Cat Zone…the company initiated a drill campaign on Gratien utilizing the same targeting methodology that was applied to identify the bonanza grades at the EGZ…Gratien is located approximately 1.5 km from the EGZ and is a kilometer-long mineralized system comprising several zones of Gold mineralization…Victor Cantore, CEO of Amex Exploration, commented, “Our Perron property, which is of district-scale potential, continues to return very high-grade Gold intercepts across the project. The results from the Gratien Zone indicate a very robust mineralized Gold system. We look forward to continuing to define the potential of the known Gold zones on the project, as well as regional exploration of undrilled structures to the east, west, and north of the known 2.4 km highly mineralized corridor. The Perron property hosts 2 faults, each measuring 7 km which are dramatically underexplored. The exploration upside potential here is incredible”…
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