Marc Lichtenfeld recently released a presentation with the header: The Great Gold Shortage of 2021.
It concerns investing in gold whereby he talks about his approach to trading the precious metal as well as the trades he would recommend.
In this article, I walk you through the presentation isolating the key talking points for you to decide what to make of it.
Want to see my no.1 recommendation for making money online?
This made us 6-figures in the last 3 months:
What is The Great Gold Shortage of 2021? (The Pitch)
The Great Gold Shortage of 2021 is a presentation by Marc Lichtenfeld where he insists that gold is the perfect investment.
Marc says that gold is becoming the only thing bankers and billionaires want to own because as the Fed prints trillions of dollars of fiat currency, inflation is starting to become inevitable. As these entities hoard precious metals, demand is increasing.
At the same time, supply is falling because mines had to be closed to curb the spread of the coronavirus when the pandemic was announced.
He says that central bankers are also buying up gold to diversify their holdings due to rising debt…
“The central bankers are planning to buy even MORE gold this year according to an international Invesco survey.
And they’re all loading up for the exact same reason:
Because debt is out of CONTROL.
Global debt is $277 trillion as a result of the pandemic, Reuters confirmed.”
To strengthen his argument, Lichtenfeld gives us an example of how the spot price of an ounce of gold doubled the last time money was printed in large quantities – during the Global Financial Crisis in 2008. He points out that as the spot price went up, a couple of gold stocks went on a tear.
To be fair to him, Gold reached record prices in 2020 following the economic fallout caused by the pandemic.
How Lichtenfeld wants to invest in Gold
As the Fed prints more money and Marc anticipates a price increase, he wants us to invest in gold, but in a certain way. First, he wants us to avoid gold coins…
“But here’s a little secret for you.
I do NOT – I repeat DO NOT – recommend investing in gold coins… because with these premiums… it’s not YOU making the profit. It’s the dealers.”
To explain why he prefers investing in gold stocks, he gives the example of Barrick Gold (which he recommends as well).
Barrick Gold (GOLD) is a massive billion-dollar mining company that pays a dividend. Barrick Gold operates 16 mines in 13 countries where it produces 5.5 million ounces per year. It costs the company $894 to produce an ounce of gold.
With the price of gold at $2,000 per ounce, he says that the company makes $1,100 on every ounce ($2,000 – $894). According to him, as the price of gold goes up, the costs of production stay the same and thus every extra dollar in the price becomes pure profit. For instance, if gold goes up to $3,000, the company will profit $2,100 per ounce and so on.
Lichtenfeld says that as the profits increase, Barrick Gold pays the additional profits out to shareholders as dividends.
The #1 Gold Trade for 2021
Besides investing in Barrick, he says that he has found The #1 Gold Trade for 2021 that is going to outperform other gold stocks. What does he reveal about it?
The first hint we get is that it does not conventionally extract gold:
“But my favorite gold stock – which sells for a remarkable $10 a share – has a unique way of extracting gold.
And it’s FAR easier than traditional mining.
You see… there’s something about gold mines that isn’t often talked about.
In order to get the gold out of the ground, tons and tons of rock and dirt must be removed.
These are called ‘tailings.’
When a mine is complete, there is often a mountain of tailings left behind that are ugly and bad for the environment.
Sometimes the land is unusable afterward.
These tailings are also filled with leftover gold missed in the initial operation.
The #1 gold company can actually clean up the tailings, extracting millions of ounces of gold while doing so.
It’s created a process called ‘nano-extraction’ that allows it to run tailings through its ‘retreatment plants’ and pull out huge amounts of gold.
Its two main plants comprise arguably the LARGEST operation in the world. And it can keep building them all over near old, abandoned gold mines.”
So, rather than dig up the ore and process it conventionally, it sets its plant up next to the mine and extracts gold from the by-product of the mining operation – the tailings.
It started extracting gold in 2019 and has been recording profits since. Lichtenfeld says that it quadrupled its profit in one year from $23 million to $94 million.
Other details he reveals about the company:
- It pays a dividend and it quadrupled its dividend as its profit rose.
- It produced 174,000 ounces of gold last year.
- It has a market cap of about $1 billion as of Marc releasing the presentation.
- Its stock sells for $10 (as he was releasing the presentation)
He argues that since every gold mine in the world has tailings, this company doesn’t have a shortage of available gold supplies to tap into with its nano-extraction process.
He wrote a report about it called The #1 Gold Trade for 2021. This dossier has details concerning the company and you can get it by signing up for a newsletter called The Oxford Income Letter.
Fortunately, you don’t have to sign up for the newsletter to find out the name of the company he is teasing because the description he gives closely matches that of DRD Gold Limited (DRD).
DRD Gold is a leading South African gold producer that specializes in recovering gold from surface tailings. It is listed on the New York Stock Exchange (as DRD). As of writing this, it was hovering around the $10 per share mark, thus matching Marc’s description.
Bonus Company Teased
In addition to the number one gold trade for 2021, he also teases a second company in one of his bonus reports. Here is an excerpt from the presentation:
“This Company Is a Precious Metals Empire
This company is in the top three of the entire world for mining…
Virtually every valuable substance, this company has its hand in.
But this is the part that I find truly fascinating – it’s almost like something out of science fiction…
This company has adopted artificial intelligence in its mining operations.
The company has more than 80 autonomous vehicles.
It has automated machines pulling these minerals out of the ground day and night.
No lunch breaks.
No getting sick or injured on the job.
These “AI miners,” if you will, have moved more than 1.1 BILLION tons of ore in their Australian mines.
To put that into perspective… the Great Pyramid of Giza weighs 6 million tons.
We’re talking 150 Great Pyramids’ worth of ore.
All moved by robots.
It’s truly mind-boggling what this company is doing to the mining industry.
It’s finally revolutionized the pick-and-shovel – with robots and software. Plus…
Revenue and profit has gone straight up for the last four years.
Cash flow is at a seven-year high.
As you’ve probably guessed, this company will PAY YOU TO INVEST with a healthy dividend.
Everything is going right for this company as the metals of our world get more and more valuable.
And that’s good because demand for materials OTHER than gold is also increasing!
This company controls $81 BILLION worth of assets across the globe.”
This one is more straightforward because that description perfectly matches Caterpillar Inc. (CAT), which is generally considered the largest construction equipment manufacturer in the world. Its machines are used in a wide range of industries and its presence is certainly felt in the mining industry.
Its autonomous Cat MineStar haulage technology is used by the Australian company, Fortescue Metals Group, to move iron ore its mines. In its mine in Western Australia, the company has moved 1 billion tonnes (1.1 billion tons) of iron ore and boosted productivity by 30% without a single incident. This is the operation Marc refers to in his presentation.
The report he wrote about it is called How to Get Paid to Invest in Metals and you also get it by signing up for his newsletter, The Oxford Income Letter.
Who is Marc Lichtenfeld?
Marc Lichtenfeld is a former business journalist and Wall Street analyst.
He is the chief income strategist at The Oxford Club and the senior editor of the Oxford Income Letter, a newsletter he publishes that espouses his income investing approach.
He has written a book on the same called Get Rich with Dividends. It was named the 2016 Book of the Year by the Institute for Financial Literacy and has been translated into multiple languages.
The book is a demonstration of Marc’s approach to investing where he seeks to achieve high returns through dividend investing with low risk. He advocates for a proprietary system that requires little to no maintenance.
He has made appearances on Bloomberg Radio, Fox Business, and CNBC and been featured on Forbes, The US News, World Report, and The Wall Street Journal.
What is The Oxford Income Letter? (The Newsletter)
The Oxford Income Letter is a newsletter that is published by The Oxford Club and headed up by Marc Lichtenfeld. It was the subject of this presentation and he did all of it to get more people to sign up for it.
Marc writes a monthly report in which he puts forth his best investment ideas that mostly concern investing in dividend stocks. He has four different model portfolios to suit different income goals. They are the compound income portfolio, the instant income portfolio, the high yield portfolio, and the fixed income portfolio.
In addition to the monthly report and access to the portfolios, you also receive the following reports for free:
- The #1 Gold Trade for 2021. We have discussed this at length and seen that it centers on his number one gold stock pick.
- The Complete Guide to Gold. It shows you how to trade gold and includes Lichtenfeld’s contacts you can buy from.
- How to Get Paid to Invest in Metals. It has details of the second company he teases that uses AI in its mining operations.
- 101 Ways to Grow and Protect Your Retirement Savings. It has Marc’s investment secrets derived from his career on Wall Street.
How much do you pay to join The Oxford Income Letter?
A one-year subscription via the presentation costs $49
Does The Oxford Income Letter have a Refund Policy?
It has a 365-day money-back guarantee.
Closing Remarks on The Great Gold Shortage of 2021
The message Marc Lichtenfeld puts across in this presentation is that as the Federal Reserve continues to print more money, investors will hedge their portfolios with gold and it will become more valuable. He suggests that we are about to see a repeat of what happened during the Financial Crisis where the Fed printed money leading to the price of gold (and gold stocks) soaring.
He prefers gold stocks to gold bullion and coins because he sees the latter as mostly profiting the dealers as opposed to the investors. Gold stocks, on the other hand, not only get more profitable as the spot price increases but also they may pay dividends.
He recommends Barrick Gold (GOLD) and DRD Gold (DRD) because he thinks they are great companies with good models and they pay dividends. And since they pay dividends, they align perfectly with his investment philosophy of income investing.
Before you go…
Want to see my no.1 recommendation for making money online?
This made us 6-figures in the last 3 months: