Inflation Escalating Fast With Devasting Consequences For the Unprepared

While government officials and central bankers have gone into overdrive trying to distract you from inflation, the savviest investors worldwide are quietly getting ready for the potential of financial chaos and wealth destruction sweeping throughout the world.

Everywhere you look right now, inflation is easy to spot. Go try to buy a house, or make a trip to your grocery store, buy a new car or look at collectibles – it’s obvious that things are getting a lot more expensive in a hurry.

The reasons for inflation are easy to see. Free government money for people that want to stay home rather than working, corporate welfare through which the largest corporations in the world are getting taxpayer funded handouts hand over fist, and low interest rates that simply make money cheap.

So now, whenever you want to buy an asset, good or service with your hard earned dollars…..you are competing with government money everywhere from the grocery aisle to the auto dealership to the local baseball card memorabilia shop. Sadly for you, the government has therefore indirectly become your competition for the essentials of life, and they have a big advantage in that they can run their money printing machines 24/7 at increasing speed.

But, don’t worry…..there is free money all over the place via the Feds and therefore you can sleep well at night, right? Not is government spending accelerating rapidly, while the deficit balloons to unimaginable levels, but every day President Biden and other world leaders are announcing new programs to redistribute wealth from savers to spenders.

If you believe this to be the case, I remind you of some famous thoughts uttered by former President Ronald Reagan;

“The most terrifying words in the English language are “I’m from the government and I’m here to help”.

You see, all of this government spending might be fun to some while it lasts, but when the music stops (as it always does) it can get very ugly in a hurry. There is another saying that comes to mind when considering this and its “there is no such thing as a free lunch.”

When there is more and more paper money available in the system, whether it be through huge government spending or low interest rates, the price of goods has to rise. More people have more paper currency and therefore have the ability to pay more and more for things like houses and groceries. More paper chasing scarcer quantities becomes a simple supply and demand function and therefore, in an inflationary environment – prices rocket higher.

This makes every paper dollar you have in your pocket today less valuable than it was worth yesterday. All over the world there have been examples of hyper inflation that ought to keep everybody awake at night. Think of Hungary, where in 1946, inflation spiralled out of control and it was reported that prices were doubling approximately every 15 hours. This makes Greece in 1944 not look so bad because price escalation got to a point where prices were doubling every 4 days. The Germany Weimer Republic, in its last days of existence was seeing approximate doubling every 3.7 days.

Right now, with the paper (fiat) money printing presses working hard and more and more money being printed, inflation seems inevitable. The only question to many, is just how bad it will get.

What the central bankers and elite government officials around the world don’t want you to know and don’t want you to act on of course is the fact that there is one currency that is not being printed with reckless abandon. A currency that the US Fed can’t control. It’s a currency that has withstood the test of time as a store of value, a hedge against uncertainty and real money for thousands of years while many paper currencies have come and gone.

This currency, is of course…….gold.

And, every day, the world’s savviest investors seem to be quietly preparing for inflation and worldwide financial uncertainty by building positions in gold and gold equities. Whether it’s Ray Dalio or Jeffrey Gundlach, Sam Zell or others…..gold is topical and relevant among some of the planet’s best market players.

Billionaire investor Eric Sprott is one of the most famous gold investors on earth. Among many triumphs in gold equities, Mr. Sprott is well known for his role at Kirkland Lake Gold as during his tenure, the company made a world class discovery in Australia at a mine called the Fosterville Mine. This created billions of dollars of wealth for early investors in the company and the Fosterville Mine became the world’s lowest cost and the world’s highest grade gold producer.

Fast forward to today and it is interesting to make note of a another investment Mr. Sprott has been announced as making in the same region by backing a company aptly called Fosterville South Exploration which trades as FSXLF in the United States and as FSX on the TSX Venture Exchange in Canada. Appropriately named because within a huge 4,000 square km land package in Victoria, Australia, the company has a 600 square km parcel of ground that actually borders the Kirkland Lake Fosterville Mine tenements to the south.

Highlights

• Lauriston is immediately south of and contiguous with Kirkland Lake Gold's Fosterville mine tenements; • 600-square-kilometre project with excellent structural setting and significant historic high-grade gold production reported despite lack of modern exploration and drilling; • Initially a two-drill rig program.

Lauriston is an epizonal gold-antimony-arsenic mineralized project, which according to a recent News Release has the best potential to be the southern extension of the Fosterfield goldfield belt, outside of Kirkland Lake Gold's tenements. The Redesdale, Whitelaw and Taradale faults intersect Lauriston, although some areas are masked by a thin younger basalt cover, leaving these particular areas on the property never explored.

The assembly of Lauriston was a multiyear process, commencing in early 2017, long before the current land rush now taking place in Victoria.

How did Fosterville South acquire this land package and attract investment from several of North America’s top gold investors, including Mr. Sprott? The story is an interesting one and centers around a well known Australian geologist who happens to live just minutes from Fosterville itself. While he has worked successfully around the world, he always kept an eye on his own backyard and after Kirkland Lake started having success at the Fosterville Mine, he quickly snapped up all of the best tenements in the area including the now incredibly fortunate move to tie up the massive 600 square km that borders Kirkland Lake’s Fosterville mine tenements to the south.

The drills at this project have just started turning. The company has close to CAD $30 million in cash and no debt. Well funded, multiple drills turning right next to one of the world’s best mines.

Things have been quiet but are about to heat up in a big way.

There is a reason that this company has attracted amazing institutional investors, some of the most successful investors in the gold sector worldwide and a management team with a track record of wealth creation. The shares currently trade at less than $1.75 per share and as the drills turn, this quiet story might become a whole lot more active. So, for investors interested in gold – this is a situation that must be paid attention to and we are happy to have put it on your radar screen on the cusp of such an incredibly exciting and potentially very lucrative time.