Frank Holmes: TSX Venture Exchange Is Poised For a Major Rally – 2/26/2014
Frank Holmes, CEO of US Global Investors, joins us to discuss bullish developments occurring in commodities and the TSX Venture exchange. Certain phenomenon such as the nearing of a golden cross, developments with the PMI, and a mixture of the fear trade and love trade from the East all spell an upward trend coming for commodities.
Frank thinks we can expect a nice, long, slow move up that is both constructive and positive. He points out that in three decades, there have only been three times, that gold stocks have fallen for three years in a row.
According to Frank, there are two big demands for gold that should be appreciated — the fear trade and the love trade. Frank states that the fear trade has to do with real interest rates that the government is paying. The other sixty percent of demand is what Frank characterizes as the love trade. The love trade occurs in places like India & China that give gold as a gifts.
Frank contends that the recent ban for gold imports in India will only prove to be minor detraction from purchases, but it will not affect the cultural affinity for purchasing gold.
Which companies is Frank currently looking at? He prefers royalty companies like Franco Nevada, Royal Gold and Silver Wheaton over the large cap miners. When it comes down the junior end, investors should look for potential buy outs and strategic companies. Some names include Comstock Mining, Virginia Gold, and Gran Colombia Gold Corp. Overall things to look for in companies? Frank insists on management.
Finally, as long as interest rates stay low, Frank believes that the Dow Jones Industrial Average continues higher.
Frank E. Holmes is chief executive and chief investment officer at U.S. Global Investors, which specializes in natural resources and emerging markets investing. U.S. Global, based in San Antonio, TX, manages 13 U.S. mutual funds and other client accounts. Holmes is co-author of the book “The Goldwater: Demystifying Gold Investing.” He has written investment articles for investment-focused publications, and is a regular contributor to a number of investor-education websites and he maintains an investment blog, “Frank Talk.”
He is a regular commentator on the business television channels CNBC, Bloomberg, Fox Business Channel, CNN’s Your Money, and he has been profiled by Barron’s, Fortune Magazine, the Financial Times and other publications.