Rick Rule recently did a great interview with billionaire Ross Beaty. The interview is worth a read given Ross' success in the mining sector. Here are the key statements I want to highlight for investors and managers in the mining sector:
- "This business is all about high risk and high reward...In public markets, given the fact of outsized risk, you want to be looking for things with outsized returns like 100% or 1000%."
- "If you’re going to be building a public company, go for size. Don’t waste your time on little things."
- "You can have a deposit that has 100 million ounces like Pebble (Northern Dynasty). It’s almost a goose egg of value if you can’t permit it and if you can’t make it work....I’d rather have 1 million ounces of high-grade gold than 100 million ounces of really, really low grade that you can’t make money on because that’s worth nothing."
- "This is a cyclical business. I know it’s going to change. How could I be even more exposed to the turn? How could I build value that’s going to come when the markets turn, when the bear market turns into a bull market? I don’t know when it’s going to happen but I know it’s going to happen."