Latest news with #AnnaSerin
The Market Online
30-07-2025
- Business
- The Market Online
Bitcoin Hits Highs, Gold Shines and Small Caps Win
The Market This Month – Episode 7. The Canadian Securities Exchange presents your go-to source for trends in junior and small cap markets. Each month, join host Anna Serin and financial expert Bruce Campbell, in partnership with Stockhouse. This article is being disseminated on behalf of the Canadian Securities Exchange, a third-party issuer, and is intended for informational purposes only. Transcript of interview below: ANNA Hi, my name's Anna Serin, and I'm Director of Listings Development with the Canadian Securities Exchange. You're joining us for yet another market this month. We are at episode seven for 2025, and this month we are going to dive into Bitcoin. Bitcoin, once again, is reaching new highs and it's bringing crypto and blockchain issuers along with it, reigniting momentum across the digital asset space. To understand where we are today, it's worth looking back at how it all began. In the midst of the 2008 global financial crisis, an anonymous figure known as Satoshi Nakamoto released a white paper titled, Bitcoin: A Peer-to-Peer Electronic Cash System. Just a few months later, in January 2009, the very first Bitcoin block, known as the Genesis Block, was mined, quietly introducing the world to decentralized digital currency. What started as a radical idea, money without banks, has since evolved into a global financial ecosystem. In the early days, Bitcoin was traded for just a few cents and it famously took 10,000 Bitcoins to buy two pizzas. Today, Bitcoin is a multi-trillion dollar asset class embraced by institutional investors, public companies, and even governments. Over the past 15 years, the cryptocurrency space has grown at incredible pace. From the creation of Ethereum and the rise of smart contracts, to the development of Stablecoins, NFTs, and now Bitcoin ETFs. Crypto has gone from fringe experiment to financial mainstream. Along with the way we've seen new regulations, growing institutional interest, and major innovations throughout the blockchain landscape. But crypto isn't the only story this month. We're also seeing continued strength in the metals markets. Gold, silver, and copper, all hitting fresh highs, driven by ongoing global uncertainty and renewed interest in hard assets as a hedge. Meanwhile, small and mid-cap stocks are outperforming their large cap peers, a notable shift from recent years. We'll take a closer look at what's behind this trend and whether this outperformance has staying power. Finally, we'll turn our attention to the tech sector. While enthusiasm remains high, the latest Bank of America Fund Manager Survey suggests that many see tech as potentially overextended. We'll explore what that means for investors and capital markets going forward. You're joining us for yet another market this month with none other than my wonderful co-host, Bruce Campbell with Stonecastle Investment Management. Thank you for joining me, Bruce. BRUCE Yeah, Anna, it's good to be here, right? The middle of summer and markets are still ripping. ANNA We have fantastic weather currently in BC. We're pretty low on the fire index, which is great news for a summer for us here in BC. But because it's so gorgeous, it is very expensive for you and I to be in the same room, isn't it, Bruce? BRUCE Yeah, it sure is. I'm not sure who's running those airlines, but they're making a lot of money. ANNA They are [laughs] yeah. Should we be investing in airlines? Maybe we should think about talking about that next episode. Listen, Bruce, it's July of 2025, and there's always some exciting stuff going on, so we're going to dive right into it. I want to talk. We've talked about this every episode, and it continues to be the same headline, but the prices are different. Metals, they continue to have some of their highest prices across the board. Let's talk about that. BRUCE Yeah, for sure. One of the things. We've been talking about it a lot lately because it's been something that's been dormant for quite some time. I guess I shouldn't say that gold has been performing, but some of the other metals haven't been, and now they are starting to perform. And there's a number of different functions and features of why this is happening. One of them is the US dollar. The US dollar has been dropping relative to other currencies. And this is something that is an inverse relationship typically, where the US dollar goes down, you see metal prices go up because they are priced in US dollars. And we saw. We've seen gold really leading the way. And to say that all the metals have not performed, that wouldn't be accurate because gold we have seen perform. But now we started to see follow through with silver, platinum, palladium. Now we're seeing copper join in as well. So, we're really getting a rally with pretty much all the metals happening at the same time. ANNA I love this. This is great news, especially for a potential resource sector in the markets. Just to touch on the US dollar, let's just remind our audience that this is by design, right? The weakened US dollar is with purpose. BRUCE Yeah. Once the current administration took over, they've done a lot of things that they talked about, they've done a lot of things they didn't talk about. But one of the things they did talk about was the fact that they deliberately wanted to have a weaker US dollar. And they've certainly been manufacturing that. I don't know if it's the way we would've expected them to manufacture it. It seems like it's a bit of lack of trust, but it's also, the US dollar tends to be a safe haven when markets aren't performing. People like to move their money just into US treasuries or into US dollars. And that of course boosts up the price of the dollar just based on supply and demand. The one interesting thing though is that now we are starting to get very stretched from a sentiment standpoint. So if we look at the. One of the interesting data points is the Bank of America Fund Manager Survey, which was just out a couple of days before we shot this. And they talk about the fact that the dollar is the most shorted that it's been in quite some time. So, there's a lot of portfolio managers out there who are betting on a lower dollar to continue. And I think that's the trend certainly in the longer term, but we could see a rally in the short term where it started to move up and spooked out some of those people, just because it is becoming a bit of a crowded trade to be so short the US dollar. ANNA Okay. And just remind us, the reason or the purpose behind a weakened US dollar is part of Trump's efforts to bring back manufacturing and activity within its own borders of the United States, right? So to make it more economical. BRUCE Yes, that's right, yeah, and competitive, right? ANNA And competitive. BRUCE And it has a big part to do also with the debt and foreign holders and things like that as well. ANNA Right, right. Okay. So, he is successfully maintaining a weakened US dollar like you said. Some of it may not have been with purpose. It actually, some of it is because there may be a softening of sentiment towards the US versus an actual purpose, but they are successful in that. Now, are we starting to see this, going back to the metals, are we starting to see this trickle out into the resource sector within the capital markets? Are we seeing this in the public companies yet? BRUCE Yeah, I definitely think we have. If you look at how this all started a year and a half or so ago now when gold really broke out and started to move, you started to see really the big cap gold companies starting to move, and that just continues to work its way down. And now you are starting to see more activity in the junior and the speculative side of things. You're seeing some of the other metals that are moving, and you're seeing some of their companies that are in those specific areas and those specific sectors that are starting to move. So you are starting to see it trickle down into capital markets for sure. I think if you, rewinded the tape 15 years ago and said, 'Gold's gonna be at this price,' what's the overall junior resource market gonna be like? I think people [laughs] would've expected it to be significantly stronger than it is. ANNA Yeah. BRUCE But sometimes these things take a lot of time. One of the things we've talked about in the past is that we saw this negative money supply a couple of years ago, and now it's gone back positive. When it was negative, the money that was outstanding and out into the system was really going after the largest cap companies. That hasn't changed a whole lot, just from those large cap company perspective, but what. ANNA Right. BRUCE We are seeing is that that's trickling down into the smaller and that is making its way into the resource market as well. ANNA Absolutely, absolutely. And when we talk about trickle-down really, on the more exploratory side of the resource sector, the gold price isn't necessarily affecting them directly. What it's affecting is the producing gold. ANNA Companies, are becoming more profitable, more valuable. And when those start getting at a larger scale and more profitable, money starts to trickle down into finding new exploration and hopefully finding new reserves, right? BRUCE Yeah, exactly. And right now, there's a few different dynamics at play there. One is that it takes so long to first find the resource, but then to build it and get it to production, that the bigger producers, they're looking for ways to grow as well. And one of the things that they can do with their stock prices moving up is then they can use their stock for currency either by raising cash or by doing an all-stock deal to go out and make acquisitions. And if it starts to shorten the timeframe that it takes for them to find and build mines, then they're gonna do that. We haven't seen a great deal of that yet. We have started. ANNA No. BRUCE To see a little bit, but that would be kind of an interesting trend that I think we'll probably start to see pick up in the last half of this year and into next year with more companies. More of the senior companies look to make acquisitions into either intermediate or junior companies. And then the intermediate and juniors might also look to be going into the explorer companies where they have not even started or moved down the path towards production but they're just still finding the resource and building it out. ANNA Yeah, absolutely. Okay, I have one more question for you on the resource sector before we move on. We really, I think every episode we've done this year, we've really had this high focus on precious metals. And I feel like in recent years, that hasn't been the focus. It's been rare earth, battery metals. What's happening on that side of the sector because we don't talk about them, and it's been a while since we've talked so much about precious metals? BRUCE Well, the battery metals, it's been certainly more challenging for the battery metals. And a lot of that has to do with two different ideas. There are two different factors. The first is that when the demand or when the projected demand for batteries, for SUV or for battery-operated vehicles was gonna go up so much, what we ended up seeing is that everyone raced to figure out how to produce those metals. And there's been a lot of money spent on that. There's a lot of money that's working towards getting that into production. And it's not that we won't need that, but the demand for the EVs has also dropped back a little bit from where the projection was by this point in time. And so it just means that the market might be a little bit oversupplied right now. So that certainly has had a bearing and we've seen those metal prices pull back. And as a result, a lot of the stocks in the sector have pulled back at the same time. The rare earths, now, that's kind of more interesting. With everything happening from a geopolitical standpoint, there's certainly some more interest in domestic rare earth production and bringing that and accessing that from areas that are more geographically and geopolitically stable. ANNA Y eah. Very interesting. Okay. Well, we'll continue to watch and see what happens there. Now we talked about this in the intro today. We gave everyone a little refresher course on Bitcoin, but Bitcoin has steadily just been growing its bigger footprint within the finance arena, globally, I think. Really kinda entering into a more institutional platform. Let's talk about the new highs that we're seeing in Bitcoin and how that's affecting the market. BRUCE Yeah, for sure. So it has. It's been pushing up against new highs again here. Bitcoin is a risk asset. And so as a result, when markets and investors get nervous, Bitcoin does tend to drop. And it did. And since that euphoria's kinda come back into the market, so has Bitcoin. It's gone up and so have a lot of the other cryptocurrencies. And then what we're seeing just from a flow of funds perspective, I think now that Bitcoin itself is just around a two and a half trillion dollar market cap. And if you add up the others, they're not nearly as big, but they certainly keep pushing that up. But what we are seeing is that there's more institutional access to Bitcoin than there ever has before. In the past, it was very challenging from a few different perspectives. The biggest probably being the ability to have custody of the assets. And now, with ETFs that have figured out the custody so that the investment managers can just go out and buy an ETF that settles on the market and sits in their account, there's more demand there. And those ETFs, the way they work, of course, is they. As more demand comes in, they create more units, and those more units turn into more buying for crypto and Bitcoin. And we're seeing more institutional support there, and we're seeing more products as well rolled out. So more ETFs globally that allow investors to invest in that sector. And it's becoming a larger adopted piece in portfolios. It still is nowhere near accepted on a wide scale, but it's just that incremental dollar that keeps coming in, and it's pushing the price higher. ANNA Do you think that there's a growing interest in the crypto ETF or Bitcoin ETF framework? Because for an investor, where we're accustomed to securities rules and regulations, the crypto is being wrapped around by that within the ETF. Do you think it provides a little security and stability to investors? BRUCE Yeah, it does. It's also the liquidity aspect of it, right? In that, they understand how an ETF trades and what they can do to put that ETF in and out of a portfolio, and they're treating it like any other vehicle that trades on a stock market from that perspective. And then the fund manufacturer or the ETF manufacturer itself has to worry about all the other issues behind the scenes as far as custody and purchasing and sales and all that to meet up with the supply and demand that happens with the ETFS. ANNA Yeah. Interesting. Okay. It keeps getting a bigger presence, and I don't think it's going anywhere anytime soon. Okay. Let's talk about small and mid-cap outperformance. Are we seeing a shift in market sentiment? BRUCE Yeah, it certainly seems that way. I touched a little bit on just the structural flow in the past with the money supply and the fact that the biggest companies have been the areas of focus. They still are. You can't turn on financial media without them talking about the Mag 7. And those Mag 7 kind of rotate around as far as who has leadership and who doesn't. But just recently, Nvidia, which is part of that group, closed above two trillion dollars in market cap, which is fairly significant for sure. And but what we've started to see now is that we've started to see a rotation down. So interestingly enough, we do a lot of technical work and compare different market caps to one another. And in the US, the Russell 2000, the S&P 600 Small Cap Index and the S&P 400 Small Cap Index, they've really been out of favor for quite some time and been underperforming. And now they're starting to perform quite well. And then here in Canada, what we're seeing is that the TSX Small Cap, which does have some resources in it, has performed fairly well. And the TSX Venture Exchange, which has a lot of resources in it, has really performed well. And interestingly enough, it's breaking through a level that has been in place for about 20 years now, just kind of as overhead resistance. And it still is nowhere near back to its high that it hit way back when, but there's certainly more interest there for sure. And it's always so fascinating because it's right at a time when sentiments swing the other way. Everyone. At the end of last year, everyone was talking Mag 7 and how crowded that market was, but they weren't looking elsewhere. And then this year, quietly, we've started to see some performance in those other market caps. ANNA Super interesting. Well, I know that you look at sentiment a lot, so I know that you put a lot of weight on sentiment shifts, right? BRUCE Well, we just watch it because quite often you have to be cognizant of what's happening. I always like to think about when too many people get on one side of a position, there's less people to then continue to move that up. And there's new money coming into markets all the time, but the reality of the situation is they do ebb and flow. And so when things swing one way so far for so long, you often have to question whether or not they're gonna swing back. And the resource market's a great example of that. We've seen that market's been very challenging for the last number of years, and now it's starting to get a bit easier for those companies to do financings and to raise money. ANNA Yeah, absolutely. Okay. Let's shift over to the tech sector. I think one thing that you've kind of talked about is that the sector might be getting a little overextended. What are you seeing happening there? BRUCE Yeah, going back to sentiment and what we talk about, if you look at that. ANNA Oh. BRUCE Fund manager survey from Bank of America that was out a couple of days ago, it showed the same thing, that we are seeing fund managers the most exposed to technology that they've been since just before 2000, which was the last time that we saw the big tech wreck that everyone talked about in the dot-com era. Does that happen this time? Well, no, it might not because we see structurally a lot of difference. Last time many of those companies didn't have any earnings. Some of them didn't even have revenue. And today, you look at a company like Nvidia and it's the largest market cap out there, but they've been growing their earnings, their revenue, and their earnings at a tremendous rate. Can it keep up? We're not sure. But where it was. BRUCE Expensive a couple of years ago, it's actually grown into that valuation. Still is a little bit expensive, but it's grown into that valuation. So. We just have to be cognizant of those things all the time that sentiment's getting pushed and, you can't use that as an only tool, you have to use it as a combination of other tools to say, 'Okay, do I have to be aware?' And we always just kind of look and say, 'Okay, that's in the back of our mind that'. ANNA Right. BRUCE That sentiment's there. And if we start to see deterioration in a number of other things that we follow, it means something and we need to act. ANNA Okay. All right. Well, we'll watch that as well. Okay, let's get into some CSE issuer news. Bruce, a few new listings. We always love to see new listings in the summertime, which is typically a bit of a quieter time. Welcome to RushGold Corp and Trimera Metals Corp, welcome to the CSE. As you can tell from the names, they're both in the resource sector. We continue to see a lot of strength in new companies coming in the resource sector. That's a lot of what we're seeing. We're also seeing some AI trickle in, which we've been anticipating for a long time, but it's finally starting to trickle in. But very heavy weighted on the resource sector as far as new listings at the CSE. On that note, I wanted to touch on Blue Lagoon Resources. I think I've talked about them in one or two of our episodes this year, but I had this amazing opportunity, and thank you to Rana Vig and his team, to go up to the Blue Lagoon Resources property, the Dome Mountain project. It is 66 kilometers outside of Smithers, BC. So last week I went, I flew up there for their official mine opening, which was pretty exciting, Bruce. I have never had the opportunity to do that. They. We all went up. They had key stakeholders, investors. They had the local First Nations band up there helping them open it, and provided an opening ceremony. We got to do a mine tour. It was quite a unique experience. It was great to witness the team that's on the ground. Normally in our position, we don't get to meet the people that are really kind of on the ground. And a lot of this team, Smithers being such a small region or area in BC. ANNA There were people that worked at the mine that had been working on and off at the mine since the '80s, and now getting to be a part of it as they do their official opening. They are expected to output 15,000 ounces of gold per year, and earlier this year they announced that they had received both its mining effluent discharge permits, from the corresponding BC ministries gaining authorization for full scale underground mining operations on their Dome Mountain project. It was quite neat that you could drive right to the property from Smithers. People get to go home at night and be with their families, which I think is quite a big deal. And they operate 12 months a year, which I thought was pretty impressive as well. So it was a pretty exciting few days for me to get to be on the ground and witness it. And this is something we have touched on, Bruce, but do you think we're gonna keep seeing permits issued in BC and Canada? BRUCE Well, certainly that was one of the things that we've talked about in the past is that there was going to be a move towards trying to get these things through the. BRUCE Regulatory burden in a quicker timeframe. And hopefully that's the case because we have a tremendous amount of resources here in Canada. We have to manage everything accordingly. But it would be nice to be able to take advantage of that. ANNA We have a potential for a great mining market. We have historical highs on precious metals. We have fantastic resources within our own country. We just need that permitting to really kind of be the, hopefully the switch. It also, they talk about relationships with our First Nations groups on the properties that are up there. And it was really unique to see the relationship that's being built there. A lot of the local First Nations work on the property. And the community that came out for the opening ceremony and did a ceremony by themselves. It was pretty unique to see, and you really start to understand how important that relationship is because of where it's all happening. So, that was good to see, and I hope we see more of it. Also want to talk a little bit about the AI sector. Wiser AI Systems, a pioneer in AI-driven cyber and third-party risk intelligence, announced that they were recognized as Canada's top 100 AI companies by the 2025 All In Summit. This prestigious designation highlights the strength of Canada's AI ecosystem and underscores Wiser AI's leadership in applying agentic AI to global risk prediction. Wiser AI is a technology company building agentic AI platforms that predict, prioritize, and monitor cyber and third-party risk. Its solutions help enterprise ingest and interpret real-time global signals to manage complex vendor ecosystems and supply chains more intelligently. Wiser empowers organizations with dynamic risk visibility and actionable intelligence to support stronger cybersecurity governance and operational resilience. Bruce, I don't know how much we've talked about AI this year. It is certainly something that we're starting to see come to market. I've had lots of conversations with potential companies coming, and a lot of them seem to be in this arena where it's existing platforms that AI can incorporate and do better than the original systems are doing. A lot around cybersecurity, a lot around infrastructure. What are your thoughts on the AI sector? What are you seeing? BRUCE We continue to see more and more uses all the time for it, and you see more companies that are coming up with unique uses for it. That's certainly made its way into the markets. The one thing that I would like to see is companies that are really producing more revenue and actually get to the earnings point. There's lots of great concepts there right now. It'd be nice to see them actually capitalize on that. And right now, that seems to be the picks and shovels companies who are producing chips and things like that, but it would be nice to see some of these companies that are using AI or built a system around AI to start to produce those numbers. ANNA Yeah. I don't see us being too far from that. It is a very fast-moving sector. And, this is from my perspective only, but I do feel like we've had some of these new technologies come to market, and trying to figure out where their applications make most sense. But it really just seems like the stuff that we're seeing coming makes really good sense to its applications. And something that will be, in the long term, something that will get utilized, and we will continue to grow and evolve around in a really meaningful way. So I see its application more productive than some of the other technologies that have come to market in recent years. BRUCE Right. Yeah, I agree 100%. ANNA Yeah. Okay. The last one I want to chat about today, is Belgravia Hartford announced a US $5 million convertible secured debenture with round 13 DAF and closing of Canadian $4 million private placements. The total proceeds, in excess of $10.86 million, for Bitcoin purchases. So, to touch on what we were talking about today, Belgravia Hartford Capital, Inc. is an investment issuer listed for trading on the CSE and focused on the tech and finance sectors of the Bitcoin ecosystem. The company's focus as set out in its 2018 investment policy specifies cryptocurrencies, artificial intelligence, media and digital streaming opportunities and invest in a portfolio of private and public companies located in jurisdictions governed by the rule of law. Its investments are considered high-risk holdings and may expose shareholders to volatility, which is, surrounded by AI and cryptocurrencies. This touches a little bit on everything that we've talked about today. Maybe you can just touch a little bit on the investment issuer sector. I know that you were an investment officer for an investment issuer. Do you think that this is maybe a sector we're gonna see more of as the cryptocurrency and AI come more and more to the capital markets? BRUCE Oh yeah, for sure. It's starting to really heat up. ANNA Yeah. BRUCE As far as activity goes. We've seen more companies that are doing treasury offerings where they're raising money to invest in some type of cryptocurrency. And then there's a lot of companies that are tying AI into the crypto market or into other markets. So we're, yeah, this is gonna. We're just at the tip of the iceberg here. I think we're gonna see a ton more. ANNA Tip of the iceberg. I love it. Okay, Bruce, before we wrap up, for the month of glorious July, what should we be thinking about going into August, other than continued nice weather? BRUCE Yeah. One of the things that I think has to be on the mind of investors is that we're coming through July being one of the strongest months of the year for performance. And then we're going into what has historically been a couple of the weaker months in the year. Doesn't mean it has to be. It's like saying, 'This is the climate,' but the weather forecast can always be a little bit different from the time. But if you are an investor, always an opportunity, especially if markets sell off, to then be able to scoop up some bargains in those months. So, something to keep your eye on and to be thinking about. ANNA Bargains are always best found with professional guidance. So, you don't know if it's a bargain or not unless you have a really good due diligence practice or you have a professional guiding you. Just a nice little reminder for everyone. Bruce, it's always a pleasure to chat with you. I look forward to chatting in August. I have big hopes for the fall. I think that there's just a lot of moving parts happening in our ecosystem that could allow for a great market to come back in the fall. What are your thoughts? BRUCE Yeah, I agree 100%. ANNA What's your crystal ball saying? BRUCE There's so many [laughs] so many dynamics right now. If some of them settle down, it could be very interesting. ANNA Absolutely. Well, listen, thank you again. Always a pleasure to chat, and we'll talk to you next month. BRUCE Okay, sounds good. Take care. ANNA Thanks, Bruce. Join the discussion: Find out what everybody's saying about Bitcoin, gold and small-caps on Stockhouse's stock forums and message boards. Stockhouse does not provide investment advice or recommendations. All investment decisions should be made based on your own research and consultation with a registered investment professional. The issuer is solely responsible for the accuracy of the information contained herein. For full disclaimer information, please click here.
The Market Online
02-07-2025
- Business
- The Market Online
Currency Shifts, Gold Lifts, and the CSE Goes Global
INTERVIEW TRANSCRIPT: ANNA Hi, my name's Anna Serin, and I'm Director of Listings Development with the Canadian Securities Exchange. You're joining us for episode five of The Market This Month . We're in a very interesting moment for global markets, and at the center of it all is the U.S. dollar. Over the past few months, we've seen a notable decline in the currency against other global currencies, particularly against the Canadian dollar. Behind that move is not just monetary policy or economic data, but something more philosophical—something being quietly referred to as the Mar-a-Lago Accord. The Mar-a-Lago Accord is the framework guiding the Trump administration's second-term trade and currency agenda. It aims to reduce U.S. trade deficits by addressing what it views as structural imbalances in the global economy, particularly the overvaluation of the dollar. It combines broad tariffs, potential currency interventions, and rethinking of international economic relationships, including proposals to link trade access with national security cooperation. This proposal is a conceptual revival of the 1985 Plaza Accord, but with a very different tone. Rather than a coordinated global effort to stabilize currencies, this new proposal suggests the U.S. should take deliberate steps to weaken the dollar to boost exports and reduce trade deficits. The idea is rooted in the belief that the dollar's role as a reserve currency makes it structurally overvalued. While this isn't official policy yet, it's already having real-world effects. Investors are watching closely as the market starts to react—from commodities to small caps to capital flows in and out of North America, we're seeing early signs of structural shifts. Today, we'll break down what this all means for Canadian markets, for investors, and for public companies. We'll talk about who stands to benefit from a weaker dollar, whether the rally of gold is sustainable, and what recent moves in the market might signal about the future of small caps. I'm joined by my wonderful co-host, Bruce Campbell with Stonecastle Investments. Thank you for joining me, Bruce. BRUCE Hey, Anna. Good to be here. ANNA We're joining each other virtually this month. I'm sad not to have you live in the studio, but hopefully you're enjoying sunshine in Kelowna while we get a little bit of January in Vancouver. BRUCE Yeah, it's been good here, for sure. ANNA Good. Let's jump right into it. Obviously, our big focus today is the U.S. dollar. We know the U.S. dollar affects global markets and currencies. My question is: the dollar has dropped—is it weak, or are other global currencies strong right now? BRUCE To answer your question: both. The dollar is relative to other currencies, and we've seen it decline versus others, so it has been weak. The rapid drop and the percentage move has been significant. As the market ran into volatility at the beginning of the year, the dollar strengthened, which is normal. We tend to see the U.S. dollar as a flight to safety. Then, as things started to stabilize and more about the Mar-a-Lago Accord came out, with both Bessant and Trump talking down the dollar, it declined. We've seen a fairly significant move so far. ANNA This will have a lot of ripple effects. Can you talk about how this might affect the Canadian markets? BRUCE The biggest thing is the inverse correlation between commodities and the U.S. dollar. Typically, when the dollar declines, commodity prices go up. Last year, we saw a strong move in gold even as the dollar was stable. Now, gold is hitting new highs as the dollar sells off. Other metals like platinum, palladium, and silver have started to move. Oil has recently started to move too. Many point to political issues like tensions in the Strait of Hormuz, but oil was trending up before that. It could be a function of investors reacting to the dollar's decline or anticipating geopolitical heat. Commodities moving typically creates inflationary pressure, which we haven't talked about in a few months. Canada is so dominated by commodities that our market has outperformed the U.S. so far this year. ANNA This creates opportunity for us. It feels so counterintuitive to purposefully create a weaker dollar, doesn't it? BRUCE They certainly want to make strategic moves they feel will help their economy both short and long term. ANNA Just to clarify, they're doing this to strengthen export abilities? If the dollar is expensive, it makes it harder to do business with other jurisdictions. Plus, they're trying to bolster their economy? BRUCE Exactly. In Canadian dollar terms, a few months ago we bottomed out around 68 cents. Now it's in the 73 cent range. That's a significant move. It has an impact—goods priced in U.S. dollars are now a bit cheaper than they were three or four months ago. ANNA It'll be interesting to see how that plays out. Let's talk about gold. These are pretty unreal prices, but we're also seeing some misalignment. Are we in a gold rush or a bubble? BRUCE I wouldn't say we're in a bubble. If you look at inflation and gold, it makes a lot of sense. Gold typically tracks inflation. One long-held metric is that the price of a good quality men's suit should be about the same as an ounce of gold. That seems to hold true. However, some indicators show it's potentially extended. Bank of America does a weekly fund manager survey. Right now, they say gold is fairly overvalued and the U.S. dollar is the least favored asset—it hasn't been this out of favor since 2005. Gold is the most over-owned asset class in the survey. Most of last year, that label belonged to the Mag 7. While some of those stocks have shifted, they haven't fallen apart. Same could be said for gold—it's moved sideways over the last month. Even though the dollar is declining, gold hits new highs, then pulls back. So I wouldn't say it's in a bubble, but we shouldn't be surprised if it stabilizes or drops $200–300 over a short period. ANNA: So, good for them. They've obviously done a really great job to have that much support in the markets. I also wanted to mention Dragonfly. They're a drone technology firm. They just raised 3.6 million US under their NASDAQ listing. I thought this was interesting because we're starting to see more and more drone companies coming to the market, which I thought was interesting. That technology really is starting to get implemented in many different ways. We have some other companies coming to us that have some neat drone technology. But also, I wanted to ask you — they are raising money in the US, and I was curious with what's been going on in our political framework. Some of our issuers wonder how US investors feel about investing in Canadian securities right now. What are your thoughts on that? BRUCE: It's definitely a vote of confidence. The fact that these US investors stepped in and invested — and they also did in US dollars — which is great to see as well. ANNA: Absolutely. Well, congratulations to Dragonfly. And then finally, just wanted to mention King Global Ventures. They closed an oversubscribed private placement of $5.5 million. The proceeds will fund ongoing exploration and drilling at their Black Canyon Project in Arizona, which includes 213 contiguous concessions and 15 former operating mines within that asset, including the past-producing Howard Copper Mine. The company is focused on precious and base metals exploration across North America. We continue to see, month by month, these nice little exploration capital raises. I know the markets have been tough in the junior and growth side, but we are seeing these nice little chunks getting raised. What are your thoughts on that? Is this specialized money? Where is this coming from? BRUCE: Well, the taps haven't been fully turned on, but in a case like this, where they have old past mines that became uneconomic at some point due to what it cost to mine and metal prices, and now you've seen metal prices rising — it becomes economic again. Turn those lights back on. This is kind of the story of the last couple years — not so much the pure exploration like 'we're going to dig a hole and try to find something,' but more like, 'Hey, we know there's something there, and we just want to restart it and get it producing cash flow.' It's going to take a little money to get there, and then they'll have the cash. ANNA: That's amazing. Well, congratulations to all of those CSE issuers on doing so well. Okay, Bruce, before we talk again in a month from now, what should we be thinking about in the markets? BRUCE: Lots to watch. We've talked a bit about the bigger picture markets — are we in a bull or a bear? Hopefully we get some clarity on that direction. With that comes sector leadership — what sectors are going to be leading, and where the opportunities lie for the next 6, 12, 24 months. ANNA: Alright, well I look forward to chatting with you again in a month. Thank you all for joining us for episode four of The Market This Month. We will be back in June for episode five. We have the Summit on Responsible Investment coming up — we'll be in your hometown of Kelowna. For anyone locally, please come and join us. All the information can be found on our website. We will be releasing content all summer long highlighting our issuers in the space, so stay tuned. If you go to our YouTube page, feel free to hit subscribe and we'll let you know when new content comes to our CSE TV. Thank you again for joining us, Bruce, and look forward to chatting next month. BRUCE: Yeah, exactly. Join the discussion: Find out what everybody's saying about this junior gold and silver mining stock on the Outcrop Silver and Gold Corp. Bullboard and check out Stockhouse's stock forums and message boards. The material provided in this article is for information only and should not be treated as investment advice. For full disclaimer information, please click here.
