“Society is ripe for collapse!” Vanessa Collette interviews Greg McCoach at the 11th Annual Silver Summit
Published in on November 12, 2013
Greg McCoach, the editor of Mining Speculator and President of Amerigold, speaks with Vanessa Collette about the current state of the markets and why he believes America is ripe for collapse, both morally and financially. A riveting and not-soon-to-be-forgotten interview!
Subscribe to us on You Tube for more video updates!
Read the transcript here:
Vanessa Collette: Welcome to Cambridge House Live. I’m here at the 11th Annual Silver Summit in Spokane, Washington. I’m joined by Greg McCoach, editor of the Mining Speculator. Greg, it’s great to have you back with us again, thank you for joining us.
Greg McCoach: Always good to be here.
VC: Great. Let's start by talking about the government shutdown that just happened in the last couple of months. What do you think the founders would think of what has just taken place?
GM: I i think they would the think it's a total farce, I think that too many egos were involved there was no need for this to happen, it was a just a wreck, the whole thing was a train wreck that didn't need to happen and the people suffer, the economy suffered, it's just ridiculous. I think -you mentioned the founders- I talked about going back to the original formula of the Constitution which unfortunately has been changed drastically and I think we need to get back to these principles, that'll help our economy come back, we need to get back to free market economy- we need to have government stop playing God and trying to control all outcomes and I think if we did these things we would get back on track.
VC: Do you think it would be healthy for the government just to let the economy go through and major correction?
GM: I absolutely believe that's what we need. We need to let things take their natural courses, we need to stop trying to manage everything, and you know trying to force things. If we would just let some of these bankruptcies go the way they should -let it happen- there's some pain, yes. But it's going to be far better to do that then you know the end result- which will be an ultimate crash of epic proportions.
VC: Now you’ve been giving advice recently to your subscribers or people in general to dump some of the stocks, that you know, look dead in the water. So what percentage of your portfolio do you think you've cut from that?
GM: Yeah I'm trying to pair things down to move to the highest quality possible - we don't know how long this downturn’s going to last. Look I’m the first guy that wants to tell you that the recovery is coming but I don't see it in the near term, this could go a lot longer than most people are anticipating so you have to stay with companies that have sustainability and I'm trying to help subscribers reduce these recommendations down to a number of companies, a much smaller number of companies, but much higher quality with less risk and I think you know as long as we know they're going to make it-just investing in these or dollar-cost averaging during this time- will be a big blessing to them because they'll make a lot of money when the recovery comes.
VC: And Greg - how do you know when it's time to cut loose from one of these companies?
GM: Well, when I see them ignoring what most companies are doing right now -when you see companies still paying themselves high salaries, executives and his companies need to be cutting their burn rate to the bone right now. And in the better companies that I am looking at right now, a lot of them have cut their salaries completely or cut them very low during this time of survival -its survival of the fittest right now so, you know, I look for good companies that have production, higher grades in general terms verses lower grades, because you know with metal prices everybody knows I believe ultimately when push comes to shove gold and silver prices are going to go crazy but that could be a ways off that could be five years down the road. In the meantime we might have lower gold and silver prices that are very you know possible at this point.
VC: Well, you’re a big advocate of investing in mining stocks but at the same time you're also warning people about a potential coming collapse in the financial system. So how do you balance the two perspectives there?
GM: You know I'm a big believer in bullion and silver and gold in the ground as far as a you know the mining stocks go I think the combination of owning both bullion that you take physical delivery of and you protect yourself from fire and theft -don't let anybody else protect it for you- you’ve got to protect it yourself… along with the quality now, we have to move towards quality. I like the little ‘good, better, best’ scenario here's a good company, here's a better company, here's the best company -well you want to be with the best companies at this point.
VC: I’m basically wondering, you know, you're advocating that people invest in mining stocks, but then also there’s this collapse scenario you talk about…
GM: I just think it's -no one has a crystal ball, you don't know when this is going to happen. There's no question in my mind that it's going to happen, but is it six months away or five years away, we don't know. So you kind of hope for the best prepare for the worst and you buy these things: precious metals or quality mining stocks when they’re in they’re in their down cycles when they're in the dips - this isn’t a dip, this is more of a major a undoing of our market but you know this is actually the time to buy and the people that do buy, I think, will turn out will be making quite a bit of money when the market recovers.
VC: You also warned of a potential coming societal collapse. What makes you think that things will get so bad?
GM: Well, just recently I think one of the big things that a lot of people aren’t talking about is the situation with China, doing these deals around the world with different countries in Renminbi - you know the Chinese currency instead of the dollar. Oil has always been traded in dollars since the early seventies when Henry Kissinger did his deal there and so central banks around the world had to hold dollars- and this was a great coup to the United States because basically this gave America the reserve currency status and there's no way we could have gotten away with all our reckless deficit spending for decades if we didn't have that reserve currency status.
Now I think this is really in jeopardy and this is a real sign that people need to start paying attention because as bad and as corrupt as our government has become and you know we've seen very difficult situations that could've morphed into a financial collapse at multiple junctures -- I think overall this dollar situation now with China, China is doing deals with the euro zone just recently, I heard another one was done the other day with Great Britain, Argentina, Russia, Brazil, blah blah blah. You know these people don't need to change to dollars first before doing something they go straight to china and trade in their currency, so ultimately instead of holding only dollars, now they're going to start holding some Renminbi along with their dollars, and I think over time they’ll hold less and less dollars more and more you know Renminbi.
So overall I think that's a situation that’s very catastrophic for the United States, that spells the end game to me. Again- how much longer can that be sustained? I think you're going to see a situation where as people don't need to hold the dollars those dollars come home to roost and that's going to cause major problems for us here in our country, probably a massive devaluation of our currency, the dollar.
VC: So between the easing and China moving away from holding as many US dollars that creates kind of a deadly combination?
GM: A terrible combination! I mean it's game over in my opinion that's why we can't -doesn't matter how much money they create out of thin air, when all these dollars are coming home to roost, you know - it really spells trouble.
VC: Barclays just recently revised their forecasts for a potential taper [to occur] from December to March because of some negative payroll reporting, but what do you think could happen here? Are we going to see any tapering or is Janet Yellen going to go the opposite way actually do more easing?
GM: I think Janet Yellen is the female version of Bernanke- on steroids- okay. She's pedal to the metal I think it was Mark Faber who said recently, expect you know $200 billion a month, $500 billion a month, a trillion a month in money creation. I think that’s the signature of Janet Yellen’s time and the as the Federal Reserve Chairman. Yes, I think we're going to see crazy numbers, not tapering, I think tapering is a joke - laughed when I heard about it. I missed the news that day when that first came out and when someone told me about it, I literally broke out laughing, because I said there's no way they're going to taper and of course they didn’t.
VC: With the US having such incredible power around the world, especially naval power, do you really see the US Empire coming to an end, when in a lot of ways it looks like it's just getting started?
GM: Well militarily, I mean I think we're going around and being the bully, we're just I think causing bad relations for America. A lot of countries now are taking offense to all our bullying and I don't blame them. We don't belong in a lot of these situations and it's not a matter of defending our homeland. Yes, we are the big bully that has all the technology we could wipe out anybody we wanted any given time. But you know America’s always been known for taking the moral high ground and it we’re no longer doing that, I don't think we'll have the support of anybody. These are just- if we don't get our way, we we bomb people- [laughs] it's absurd I mean it's just-- society is just ripe for collapse in so many ways financially, morally, you know many, many, different ways and just because you're the strongest military doesn't make it right.
VC: Right. Well just as we wrap up, I want to get to some of our great viewer questions I have been sent. We had a question from Dave Holmgren in California and he is asking ‘which companies do you think you have the best current ounces and grades and gold and silver’?
GM: Yes, good question. I’m trying to move my portfolio and you know help subscribers move towards these higher grade situations. When you have a higher grade situation that protects you when metal prices are fluctuating the way they are right now especially if we go lower. The higher the grade the project, the less the costs are per ounce in getting it out of the ground. Hopefully you're going to be more protected that way. So some companies I’ll just name off the top my head in silver, as were at the Silver Summit. I like Endeavor Silver, they have three producing mines, they have 20-22 million I think in the Treasury right now, they're producing sixty-eight thousand ounces of gold, six million ounces of silver and have been very robust very profitable operation. I another company like is Silvercrest, tons of money in the bank, very profitable operations at current prices, very well-managed. NOT only do they have a resource that they are mining but they're also building ounces there- they're still finding more ounces, and they also have an additional discovery a few hours away from where they're operating right now. So I just think those are the kind of companies you really want to pay attention to especially when you see them at their discounted prices right now.
VC: I guess that answers the other question we have, from mining stocks guide - if you could buy silver company right now which one?
GM: Yes, Silvercrest, Endeavor, you know they're kind of in the same genre there. We do have to worry about this Mexican mining ruling that's coming out, there is a tax that is supposedly going to be added here, by first of the year, they're voting on it. I think in the next few days so we should know, next week. I'm hoping that reasonable heads prevail. We're going to see some sort of tax I just want it to be reasonable, not offensive; you know where it shuts mining operations down. That doesn't work for anybody, it would hurt the Mexican economy and ultimately I think will get something that's very reasonable.
VC: Our last question is from the Silver house in Amsterdam “Greg how many ounces of silver are in reserves above ground?
GM: Well I could take that question two ways, but I think what the question is, is there used to be a strategic silver supply in the United States -at one point it was over two billion ounces - that's no longer the case. All that silvers gone. There's no longer any strategic supply of silver, there are some inventories of silver on the Comex, but most of those are already accounted for - it's not like they're free ounces that are available. So someone that wanted to grab those ounces- most of them have warehouse receipts and they're owned by somebody so I would say very little in above ground reserves.
VC: Well Greg it was great having at the time to chat with you today, a great conversation we look forward to having you back again soon.
GM: Always a pleasure, thank you.
Subscribe to us on You Tube for more video updates!
Read the transcript here:
Vanessa Collette: Welcome to Cambridge House Live. I’m here at the 11th Annual Silver Summit in Spokane, Washington. I’m joined by Greg McCoach, editor of the Mining Speculator. Greg, it’s great to have you back with us again, thank you for joining us.
Greg McCoach: Always good to be here.
VC: Great. Let's start by talking about the government shutdown that just happened in the last couple of months. What do you think the founders would think of what has just taken place?
GM: I i think they would the think it's a total farce, I think that too many egos were involved there was no need for this to happen, it was a just a wreck, the whole thing was a train wreck that didn't need to happen and the people suffer, the economy suffered, it's just ridiculous. I think -you mentioned the founders- I talked about going back to the original formula of the Constitution which unfortunately has been changed drastically and I think we need to get back to these principles, that'll help our economy come back, we need to get back to free market economy- we need to have government stop playing God and trying to control all outcomes and I think if we did these things we would get back on track.
VC: Do you think it would be healthy for the government just to let the economy go through and major correction?
GM: I absolutely believe that's what we need. We need to let things take their natural courses, we need to stop trying to manage everything, and you know trying to force things. If we would just let some of these bankruptcies go the way they should -let it happen- there's some pain, yes. But it's going to be far better to do that then you know the end result- which will be an ultimate crash of epic proportions.
VC: Now you’ve been giving advice recently to your subscribers or people in general to dump some of the stocks, that you know, look dead in the water. So what percentage of your portfolio do you think you've cut from that?
GM: Yeah I'm trying to pair things down to move to the highest quality possible - we don't know how long this downturn’s going to last. Look I’m the first guy that wants to tell you that the recovery is coming but I don't see it in the near term, this could go a lot longer than most people are anticipating so you have to stay with companies that have sustainability and I'm trying to help subscribers reduce these recommendations down to a number of companies, a much smaller number of companies, but much higher quality with less risk and I think you know as long as we know they're going to make it-just investing in these or dollar-cost averaging during this time- will be a big blessing to them because they'll make a lot of money when the recovery comes.
VC: And Greg - how do you know when it's time to cut loose from one of these companies?
GM: Well, when I see them ignoring what most companies are doing right now -when you see companies still paying themselves high salaries, executives and his companies need to be cutting their burn rate to the bone right now. And in the better companies that I am looking at right now, a lot of them have cut their salaries completely or cut them very low during this time of survival -its survival of the fittest right now so, you know, I look for good companies that have production, higher grades in general terms verses lower grades, because you know with metal prices everybody knows I believe ultimately when push comes to shove gold and silver prices are going to go crazy but that could be a ways off that could be five years down the road. In the meantime we might have lower gold and silver prices that are very you know possible at this point.
VC: Well, you’re a big advocate of investing in mining stocks but at the same time you're also warning people about a potential coming collapse in the financial system. So how do you balance the two perspectives there?
GM: You know I'm a big believer in bullion and silver and gold in the ground as far as a you know the mining stocks go I think the combination of owning both bullion that you take physical delivery of and you protect yourself from fire and theft -don't let anybody else protect it for you- you’ve got to protect it yourself… along with the quality now, we have to move towards quality. I like the little ‘good, better, best’ scenario here's a good company, here's a better company, here's the best company -well you want to be with the best companies at this point.
VC: I’m basically wondering, you know, you're advocating that people invest in mining stocks, but then also there’s this collapse scenario you talk about…
GM: I just think it's -no one has a crystal ball, you don't know when this is going to happen. There's no question in my mind that it's going to happen, but is it six months away or five years away, we don't know. So you kind of hope for the best prepare for the worst and you buy these things: precious metals or quality mining stocks when they’re in they’re in their down cycles when they're in the dips - this isn’t a dip, this is more of a major a undoing of our market but you know this is actually the time to buy and the people that do buy, I think, will turn out will be making quite a bit of money when the market recovers.
VC: You also warned of a potential coming societal collapse. What makes you think that things will get so bad?
GM: Well, just recently I think one of the big things that a lot of people aren’t talking about is the situation with China, doing these deals around the world with different countries in Renminbi - you know the Chinese currency instead of the dollar. Oil has always been traded in dollars since the early seventies when Henry Kissinger did his deal there and so central banks around the world had to hold dollars- and this was a great coup to the United States because basically this gave America the reserve currency status and there's no way we could have gotten away with all our reckless deficit spending for decades if we didn't have that reserve currency status.
Now I think this is really in jeopardy and this is a real sign that people need to start paying attention because as bad and as corrupt as our government has become and you know we've seen very difficult situations that could've morphed into a financial collapse at multiple junctures -- I think overall this dollar situation now with China, China is doing deals with the euro zone just recently, I heard another one was done the other day with Great Britain, Argentina, Russia, Brazil, blah blah blah. You know these people don't need to change to dollars first before doing something they go straight to china and trade in their currency, so ultimately instead of holding only dollars, now they're going to start holding some Renminbi along with their dollars, and I think over time they’ll hold less and less dollars more and more you know Renminbi.
So overall I think that's a situation that’s very catastrophic for the United States, that spells the end game to me. Again- how much longer can that be sustained? I think you're going to see a situation where as people don't need to hold the dollars those dollars come home to roost and that's going to cause major problems for us here in our country, probably a massive devaluation of our currency, the dollar.
VC: So between the easing and China moving away from holding as many US dollars that creates kind of a deadly combination?
GM: A terrible combination! I mean it's game over in my opinion that's why we can't -doesn't matter how much money they create out of thin air, when all these dollars are coming home to roost, you know - it really spells trouble.
VC: Barclays just recently revised their forecasts for a potential taper [to occur] from December to March because of some negative payroll reporting, but what do you think could happen here? Are we going to see any tapering or is Janet Yellen going to go the opposite way actually do more easing?
GM: I think Janet Yellen is the female version of Bernanke- on steroids- okay. She's pedal to the metal I think it was Mark Faber who said recently, expect you know $200 billion a month, $500 billion a month, a trillion a month in money creation. I think that’s the signature of Janet Yellen’s time and the as the Federal Reserve Chairman. Yes, I think we're going to see crazy numbers, not tapering, I think tapering is a joke - laughed when I heard about it. I missed the news that day when that first came out and when someone told me about it, I literally broke out laughing, because I said there's no way they're going to taper and of course they didn’t.
VC: With the US having such incredible power around the world, especially naval power, do you really see the US Empire coming to an end, when in a lot of ways it looks like it's just getting started?
GM: Well militarily, I mean I think we're going around and being the bully, we're just I think causing bad relations for America. A lot of countries now are taking offense to all our bullying and I don't blame them. We don't belong in a lot of these situations and it's not a matter of defending our homeland. Yes, we are the big bully that has all the technology we could wipe out anybody we wanted any given time. But you know America’s always been known for taking the moral high ground and it we’re no longer doing that, I don't think we'll have the support of anybody. These are just- if we don't get our way, we we bomb people- [laughs] it's absurd I mean it's just-- society is just ripe for collapse in so many ways financially, morally, you know many, many, different ways and just because you're the strongest military doesn't make it right.
VC: Right. Well just as we wrap up, I want to get to some of our great viewer questions I have been sent. We had a question from Dave Holmgren in California and he is asking ‘which companies do you think you have the best current ounces and grades and gold and silver’?
GM: Yes, good question. I’m trying to move my portfolio and you know help subscribers move towards these higher grade situations. When you have a higher grade situation that protects you when metal prices are fluctuating the way they are right now especially if we go lower. The higher the grade the project, the less the costs are per ounce in getting it out of the ground. Hopefully you're going to be more protected that way. So some companies I’ll just name off the top my head in silver, as were at the Silver Summit. I like Endeavor Silver, they have three producing mines, they have 20-22 million I think in the Treasury right now, they're producing sixty-eight thousand ounces of gold, six million ounces of silver and have been very robust very profitable operation. I another company like is Silvercrest, tons of money in the bank, very profitable operations at current prices, very well-managed. NOT only do they have a resource that they are mining but they're also building ounces there- they're still finding more ounces, and they also have an additional discovery a few hours away from where they're operating right now. So I just think those are the kind of companies you really want to pay attention to especially when you see them at their discounted prices right now.
VC: I guess that answers the other question we have, from mining stocks guide - if you could buy silver company right now which one?
GM: Yes, Silvercrest, Endeavor, you know they're kind of in the same genre there. We do have to worry about this Mexican mining ruling that's coming out, there is a tax that is supposedly going to be added here, by first of the year, they're voting on it. I think in the next few days so we should know, next week. I'm hoping that reasonable heads prevail. We're going to see some sort of tax I just want it to be reasonable, not offensive; you know where it shuts mining operations down. That doesn't work for anybody, it would hurt the Mexican economy and ultimately I think will get something that's very reasonable.
VC: Our last question is from the Silver house in Amsterdam “Greg how many ounces of silver are in reserves above ground?
GM: Well I could take that question two ways, but I think what the question is, is there used to be a strategic silver supply in the United States -at one point it was over two billion ounces - that's no longer the case. All that silvers gone. There's no longer any strategic supply of silver, there are some inventories of silver on the Comex, but most of those are already accounted for - it's not like they're free ounces that are available. So someone that wanted to grab those ounces- most of them have warehouse receipts and they're owned by somebody so I would say very little in above ground reserves.
VC: Well Greg it was great having at the time to chat with you today, a great conversation we look forward to having you back again soon.
GM: Always a pleasure, thank you.
Comments