Analysis: Mining Lessons From the 1970s
Market Rundown
Housekeeping:
Today’s post has an excellent 25 page submission on metals mining and the analogue to 1970s behavior. There are major differences between now and back then at the business level that alter timing of moves despite the inflationary similarities. We hope you enjoy it.
Market Rundown:
Good Morning. The dollar is up 40 bps. Bonds are slightly softer. Stocks are on either side of unchanged so far. Gold is down $4. Silver is down 15 cents. Crude oil is up 80 cents and Natural Gas is up a large 30 cents (over 3%). Grains are softer slightly. Crypto is mixed and taking its cues form stocks so far today. Have a great day
Today’s GoldFix Posts
Mining Lessons From the 1970s
In the 1970s, gold prices rose faster than costs and gold miner valuations soared, while copper stocks were hurt by margin compression, environmental regulations, and resource nationalism.
The sector was partially consolidated by energy producers. After 1974, gold miners fell over 50% through to mid-1976 (S&P500 up 8%), after which gold prices soared and so did the gold miners, appreciating over 700% off the August 1976 lows by 1980 (S&P500 up 22%)
More at bottom