Steve McDonald: Hi, everybody. I'm Steve McDonald. This is your Market Wake-Up Call. Our guest this week is the Club's mining expert and one of my favorite analysts, Sean Brodrick. He's here to talk about the big run-up in gold and the opportunities miners are presenting – not bullion. Welcome, Sean. Sean Brodrick: Thanks for having me on, Steve. Steve McDonald: It's my pleasure. Gold's made a big move this year. Where should our Members be looking for opportunities? Sean Brodrick: Well, it all depends, Steve, on how much risk they can actually handle. For those people who are real speculators, you know, and who don't mind risk, then they should probably look at options on the larger miners, because that can really – Steve McDonald: No, wait, wait, wait. When you say larger miners, who are you talking about? Newmont, Goldcorp, those people? Sean Brodrick: Yeah, Newmont, Barrick, Goldcorp – those are the larger miners. But you can also get some great returns with the junior miners. I mean, in fact, junior miners have been outperforming the larger miners so far in the run-up this year. Now we are seeing a short-term pullback in gold, but when gold heads higher again, I expect the junior miners to keep outperforming. Steve McDonald: That's interesting. Just so we're all on the same page, what's the difference between a junior or a small miner, and a big producer? Sean Brodrick: Well, we could speak about market cap or production, but one way that I like to look at it is the junior miners really have everything focused on one or maybe two assets. You know, they might be working on a mine or actually developing that mine, maybe even just exploring that mine. But the larger miners have many assets and usually spread across the world geographically. And so that's the way I look at it, because that again raises the risk-reward level. Because if you have a small junior miner who only has one or two assets, then Wall Street really doesn't know much about it. And so you can have some really exciting news about that company that will just send the stock soaring. The larger miners, pretty much we know what they're doing, so they're just kind of a play on gold. Now they are leveraged to the price of gold, but you pretty much know what's going to happen with them. Steve McDonald: Now, speaking of gold, it's been off, not slightly either. Is this a bigger buying opportunity, or how are you playing this? Sean Brodrick: Well, yes, in the short term, gold has been going down; however, we are probably close to a new bottom. And because the larger-term trend is up, you have to look at this correction as a great buying opportunity. And yeah, we've had buying opportunities before, but when you have a big pullback, that's when it's time to really muscle up and step up to the table, because you can get some opportunities on things that for weeks you were saying, “Oh, I wish I'd bought that.” “Oh, I wish I'd bought that.” Now you get to buy it at a cheaper price. So yeah, this is a great buying opportunity, and I think that people who actually want to make money in this market will be seizing those opportunities. Steve McDonald: So we're looking at options on the big gold miners, equities for the small miners, the junior miners as you call them – Sean Brodrick: Yeah. Steve McDonald: And this gold dip right now that we're in is actually a buying opportunity, correct? Sean Brodrick: That's the way I look at it. I mean, we have seen a whole bunch of trends come together. They aren't short-term trends either. We've actually seen a peak in global gold production, and at the same time we've seen, you know, encouraging signs in demand around the world. More and more people want to own it. You put those two things together. That's just a big plus for the price of gold. And then let's add in the negative interest rates. Central banks across Europe and in Japan have cut and cut and cut interest rates until they're in negative territory. There are $13.4 trillion worth of negative-yielding bonds now. And so that just changes the whole financial game. There used to be a carrying cost of owning gold because you could always make money in bonds, right? Or at least in like nice, safe bonds from Japan, Germany, stuff like that. Now that yield is gone, so people in those countries have to look to put their money somewhere, and one place they will put it, especially because of all the stuff that's going on around the world, will probably be in gold. Steve McDonald: Sean, thanks so much for being with us. It's always good to hear your perspective on this stuff. Sean Brodrick: Hey, thanks for having me on. And remember, buy gold. Steve McDonald: Buy gold. Thanks again, and for everybody here at the Market Wake-Up Call, thank you for being a part of this. I'll see you next week. [End of Audio]