Letter From The Ceo

Bruce Tatters, CEO, Red Cloud Securities Inc.


We entered 2022 in a struggling precious metals market and as we wind down the year, we’re seeing that investor sentiment isn’t improving in the short-term. Although much of the commodity spectrum has seen this weakness, we have seen some strength in the critical metals markets, namely lithium. At Red Cloud, we feel there is reason for optimism as we prepare for a new year, despite a gloomy near-term outlook. Firstly, the precious metals markets are likely to turn higher for the first time in over two years following the end of U.S. Central Bank tightening. Most industry forecasters see the rate cycle ending near the 4 per cent to 4.5 per cent level. When considering rates were near zero at the beginning of 2022 and consensus has them approaching 3.75 per cent to 4 per cent at the Nov. 2 meeting, it’s hard to argue that the end of the rate hiking cycle draws near. Moreover, the largest gold producer’s stocks appear to have bottomed during the summer months and have been trading rangebound during the fall. All indicators point to a brighter 2023 for gold and silver stocks. On the other hand, critical metals commodity markets have held up dramatically better than overall sentiment and equity counterparts. Much of this phenomenon points back the last decade of underinvestment and corresponding dearth of new available supply. We continue to witness a tug of war between the bullish sheer physical tightness in each of these commodities versus the bearish overall sentiment pressing down on pricing. None of this looks forward to the inevitable consumption growth surge from the decarbonization revolution that lies in front of us. Despite the near-term challenges, it has been decades since the mid-term and longer-term outlook looked this bright. We anticipate that within one to two years, we will find ourselves in a metal constrained market for decades. At Red Cloud, we remain steadfast committed and focused on the mining commodity sectors. We, above all others, believe in the essential need toward growth in supply to these markets. Moreover, we strongly trust the entrepreneurial spirit of the junior explorer, developer, and producer remain the key focus to achieving this goal. We continue to innovate our products and services to better assist this core group. Red Cloud continues to enhance our efforts to build our team, expand our distribution, grow our research presence, and add new services. Please enjoy the conference – the entire Red Cloud team works exceptionally hard to make each new conference the best we have ever hosted. As always, the Red Cloud team members are here for your assistance.



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