Raw Transcript: $5,000 Gold Hits In 2026; 'This Is Just The Beginning' | Keyvan Salehi

If you're an investor looking in from the outside, especially the younger generation of investors, millennials, Gen Z who are, you know, more involved with their uh with their investment decisions, uh you look at that and say, "Okay, if gold's at 4200 and I think the next 10 years is going to average out at 3100, which is the highest I've seen from one of the banks in Canada, um why would I invest in this space?" If I were to bet on one going higher and the other one correcting, it would be gold and gold equities going higher and the broader market correcting. What about your outlook for the gold price in 2026? I'm joined today by Kavon Selei. He's the president and CEO of Stellar Gold. Now, the gold market has been on fire, but the mining sector has been slow to catch up. We're going to find out why. What's next for both mining and gold? Welcome to the show, Kavon. Good to see you. Hi, David. Thanks for having me. Great to be here. What was the one thing that surprised you the most about this massive run up from gold uh gold's $2,000 price 18 months ago to $4,200 today. Uh to be honest, I'm not actually I'm not surprised at all with this move. Uh it's a move that's been a long time coming and myself included with a lot of other people have been calling for gold 5000 which uh at $4,200 gold today. were about 25 20% off of that mark. Um, all the reasons that we've been talking about why gold should go to 5,000 have been there and they still remain intact. So, I think investors are going to see 5,000 gold before the end of next year. Uh, things like geopolitical risk, uh, inflation. Um, and most important of all, rising debt levels, not just in the US, but also global debt system. I think that's just out of control. And I think gold is the only and the best hedge against all those risks. So I'm not surprised at all with that move. I think this is just the beginning. Uh we are coming out of a decadel long bare market for gold and gold miners. Um and I think it's just the beginning and there's a couple of positive signs that I see in the market right now. Uh for the first time in a long time, the general investors are actually taking notice and I think they fueled some of the rotation back into gold and uh gold equities and I think that's going to continue as well. So when you say that the bull market's going to continue, I think the first question that I have on my mind and some others as well is how do you know this time is not the same as prior cycles? In other words, why is this time different? Let's take a look at what happened in prior cycles. 1980 gold peaked and uh and we had a double top fell stayed flat for basically 14 years. No, 20 something years. Yeah, it was a 20-year low and then finally gold started showing signs of life. It was a multi-year almost 10-year uh slow rally, not a fast uh monumental parabolic rise like we're seeing now up until 2011 when gold again had a double top, fell by the order of 30 40%, stayed flat for about 10 years. Same thing happened in 2020, although uh 2020 I I I say was probably the beginning. Then in retrospect, the beginning innings of this b bull market and I remember back back then five years ago people were saying the same thing. Well, this bull market is going to uh is just getting started. We're going to see a lot higher prices. They turned out to be correct. But if history were any guide, uh it's been pretty consistent. Gold tends to have shown a double top somewhere. We haven't seen that yet. But if it falls goes up, we can see a correction by the order of 30 40% and then stay flat for another decade. Yeah. Why is this time any different? That's a fair point. I mean, the last decade, like I said, we've been in a decade long recession for gold and miners as well. Uh we've had a couple of attempts uh I think in 2016 and maybe 20 uh where the metal tried to break out and uh that was obviously not successful. Uh but what I would say is if you look at you know the bare market that we're just coming out of and the gold and the miners um we've also had a more than a decade long the craziest bull run that we've seen in the broader market like tech NASDAQ S&P 500 since the financial crisis and although we've had a couple of hiccups along the way for the most part it's been a V-shaped recovery. I mean like you know within 3 to 6 months of any 15 20% correction uh within those major indices we've seen all-time highs and I think that cycle is about to break. Uh this is something that gets discussed and I know you've had guests on your show that talk about that. Uh it just cannot continue. Uh that's my personal belief and I believe that's the major catalyst. It's not a question of if but when we haven't seen a prolonged David sustained correction in the broader market. Um and the latest run is uh essentially being you know uh put on the back of you know the hype with AI and I think that bubble at some point will burst and when that happens I think that's the event that's going to be the major catalyst for why gold is going to have a bigger breakout and that's going to essentially uh uh you know cause mining stocks gold uh gold securities to go even higher because that's when we're going to get a real rotation uh into mining stocks. Uh we haven't really seen that. We're just getting uh we're just getting a small bit of that uh in terms of rotation uh from general investors and retail, some of the younger generation investors, millennials, Gen Z, but for the most part, they haven't really seen a bull market uh in terms of gold and mining commodities. Uh so I think that I think that's that's that's going to be the major catalyst for why I think u gold's got a lot more um more room to run. Can we compare this cycle to 2011? What's different? Um what's similar in terms of investor sentiment and mining activity? Well, look uh in terms of demand, uh you know, we talked about some of the some of the reasons why the demand for gold is going up. Uh China, uh Russia, central banks continue to buy gold. Um and more importantly, coming out of a 10-year u you know bare cycle in gold and mining companies, we haven't seen a lot of investment. So I think supply side is going to have a hard time catching up. It's not like you can turn on the tap and and start producing a lot of gold. Uh to meet that demand, uh we're looking at anywhere from 15 to 20 years from discovery all the way to construction, eventually production of mines. So that supply chain is also going to be limited. Um but again like I said, uh the rising debt levels and the fact that that's going to have a huge impact on fiat currencies and devalue them is uh what I think why I believe gold has a lot more room to run. in addition to the fact that I think we are at close to top of the market in the broader markets like NASDAQ S&P 500. What about your outlook for the gold price in 2026? Well, look, like I said, I mean, myself included with a lot of other people, we've been calling for gold 5,000. It's taken quite quite a bit of time to get here. Uh, you know, timing is can't always time these things. Um, but I think within 20% of that move, I think investors are going to see gold 5,000 before the end of next year. $5,000. Uh, I remember when I first started in the in the industry a couple years ago and uh, people were calling for $5,000 gold and back then they were labeled crazy. Now it's less than 25% from current levels. Yeah. So, it's not even it's taking a bit of time to get here. Like I said, um, uh, you can't find these things. It's a lot of it and I keep saying this and I maybe at at the risk of sounding a bit repetitious. Uh, a lot of it has it comes down to capital allocation. the fact that we've had this insane run in the broader market uh tech cryptocurrencies and these are some of the things that mining stocks and gold in general have to compete with in terms of capital allocation right and I and I think uh we are now finally at an inflection point where uh past AI and this AI boom I I don't see anything else I'm not hearing anything else and uh happy to hear uh other ideas or thoughts as to what can keep the the broader markets going even higher uh but again as an investor if I were to bet on one correct thing and the other one uh between two assets, gold and the broader market, I would I would be betting on gold here. Again, the reasons why a lot of people have been calling for gold 5,000 for the past decade or so, they still remain intact. Uh the rising debt levels in the US, the long-term outlook for US currency, I think all those reasons still remain intact and nothing has changed this year. And the other thing I I'll point this out to as well, look, look at the 2025. We've had an all-time high in the price of gold and we've also had the broader market, the major indices in the US make all time make all-time highs as well in S&P 500 and NASDAQ, right? So, um uh that's that that's a bit of an anomaly. I mean, that's something that uh it's it's a bit uh it's it's unusual looking at uh the history of the way the two asset classes have traded in the past and uh I think there's going to be a divergence. And again, it goes back to my point originally as to as an investor, which one are you betting on going forward? I like to compare my gas forecast to um large banks. So JP Morgan, I believe, is from what I found the most bullish bank on gold. There there may be others, but I think the big from the big banks, their bullish brackets, they're one of the more bullish ones. They originally in the summertime projected $4,000 by 2026. And uh the the the fundamental rationale hasn't changed, but they've obviously since up updated and upgraded their forecast because they've the gold price has blown way past $4,000 before 2026. And now they're saying $5,000 uh $5,55 an ounce. Very specific. Uh by fourth quarter 2026. So that's exactly in line with what you're saying. Gold remains our highest conviction long for the year. and we see further upside as the market enters a Fed rate cut cycle said their head of global commodity strategy. That's a pretty bold statement. Their highest long conviction now they're attributing this to the combination of Fed cutting, stag stackflation anxiety, concerns about Fed independence. That's a big one, right? because we don't know if let's say Kevin Hassid who Trump wants to appoint to the Fed is going to be basically just an extension of the White House and broader debasement hedging uh on the dollar. She said that uh it's not a darization story, it's a debasement story. People are moving away from the dollar, diversifying. Um and then furthermore, she said $6,000 by 2028. So she's even more bullish than you long term, uh this analyst. So, well, look, I'll tell you this, David. That's great to see. I love hearing that. I think we need more voices like that that are more realistic. Contrary to that, if you look at some of the big banks in Canada and they put out their long-term price uh projections for gold all the time historically and you can go back as you know 20 years back and if you look at the spot price of gold and the long-term projections for price of gold that the big major banks in the Canada anyways put out, it's always anywhere from 20 to 40% below uh the long-term uh below the spot price. And I think that's that's been a challenge for us as well. So, if you're an investor looking in from the outside, especially the younger generation of investors, millennials, Gen Z, who are, you know, more involved with their uh with their investment decisions and, you know, they're now getting they're now in the workforce, they're making decisions and, you know, as to where money is going to uh be allocated to, uh, you look at that and say, okay, if gold's at 4,200 and I think the next 10 years is going to average out at 3100, which is the highest I've seen from one of the banks in Canada, um, why would I invest in this space? And that's been a challenge and that's been historically that's been the trend. All the long long-term price projections um uh in Canada anyways with the big banks has always been super conservative in relation to the spot price. And that's something that uh you know I'm not sure I don't have a I don't have a solution for it. I don't think we're going to solve that problem today. But that's a challenge that we as an industry have to overcome. And I think it comes down to education, being uh more promotional about the products that we pull out of the ground, marketing, advertising, and just raising awareness about what we do, the products that we pull out of the ground, and essentially branding. Uh it's it's it's it's that's something that the industry is essentially uh faced with every day. Uh as an investor, if you look at that and say, "Well, gold's at 4200. The banks are telling me that it's going to go down. It's going to be at 3100 over the next 10 years. Why would I invest in this space?" that that's something that we're going to have to overcome as an industry. Why do you think these um analysts at banks are more conservative with our outlook? I I I if I'm being fully frank with you, I don't have an answer to that. I I I look, we talked about this at the top of the show. We've had a few uh it's been a cyclical industry. So, uh in the past, you would have, you know, from peak to trough, you would have three to four years where or peak to peak, you would have anywhere from 7 to 8 years. That's what I learned coming out of uh University of Toronto uh learning mining engineering that it was a cyclical industry but as we discussed again earlier uh we haven't really seen that. So for the past you know 12 13 years uh gold and gold securities have been in a bare market with the exception of the last couple years we've had a nice run from 2000 to 4,000. But so again uh that could be the reason why they're conservative but I couldn't really comment on that. Uh I'm sure they have their own formula and how they come up with some of these calculations, but the challenge is that it's always been conservative. It's not like it's been well once one year I'm going to be more aggressive and one year I'm going to be more conservative. It's always been in the 25 to 35 40% range conservative in relation to where this spot price for the metal is. You mentioned the debt issue, the global debt issue. So global debts are past 300 trillion and just in the US is 38 trillion which is like 10% of global debt. When you think about it, it's crazy. foreign country. But anyway, uh at what point does this become unsustainable, Kavon? And why why do uh metals and hard assets fit into this picture? Well, I think it's uh it's look, my personal view is that it's unsustainable now. Uh and I think a lot of people that have been calling for gold 5,000 or even 6,000 would make the same argument. Um so I I don't I don't really have an answer to that, David. I I my view is that it's unsustainable now and like you know having the again gold being a perfect hedge against some of the some of the risks that we're seeing here right like so fiat currencies uh whether it's US currency or some of the other some of the other currencies I think um yeah I I think to short answer to your question is that it's it's already an untenable situation. Tell us about why people around the world need gold. I mean, I'm not just talking about investors who speculate in gold in North America. I'm talking about people in China who per perhaps are buying gold for uh investment reasons. People in India maybe buying gold for jewelry. Uh people in the Middle East, Turkey for example, having had a history of buying gold when the currency has depreciated significantly. And all around the world, same story. Tell us about some different use cases that you've observed. Well, look, you like that's that's a great point. uh more than close to 40 45 to 55% of gold that's produced goes towards jewelry and yes some of that is uh commercial and luxury goods and all those other things but for the most part uh you know you and I and you know North America and the west were you know comfortable with the currencies that we have to live with uh because they're more stable but when you look at higher risk jurisdictions like Turkey you look at India u gold has always been a hedge against a very highly volatile and risky currency uh region currencies if you will right and this is why a lot of people buy like for example when you talk about India a lot of people buy gold and jewelry because it's not just because they want to buy luxury goods it's actually a hedge against uh some of the volatility in their own regional currencies and uh I I think that's going to continue as well again going back and echoing some of the things that we've talked about in terms of you know devaluation of fiat currencies and rising debt levels and so forth well let's talk about uh the money sector so there's about more than a thousand junior companies on the TSX I It's a lot. And I know for a fact not all of them are legitimate projects. How do we differentiate between the good ones versus the not so good ones and then the fairly valued ones versus you were talking about valuations before? How do we how do we know if something is fairly valued or completely overvalued? Well, I think for the most part, like I said before, I think the entire space, even from large caps all the way to juniors, small caps, companies like Stellar are still grossly undervalued, especially in relation to the movement of the price of gold that we've had over the last couple years. uh to your point, a lot of those companies that are listed on the TSX and TSXV and perhaps even uh you know indices uh uh abroad, they're just shell companies and they don't even they don't even have projects in their portfolio. So that that's something uh I think that's an area where we need help from regulators uh in terms of okay why are these company listed why are these companies listed and why are they promoting themselves as mining companies when they don't even have a project. Um well ultimately just comes down to uh as I said before marketing raising awareness uh and that's incumbent on us as issuers and uh junior mining company stocks and even uh the majors as well as to who we are what our projects are and what they're capable of doing. We talked about the supply side of the equation. If you believe the demand for gold and the physical is going to be there over the next you know decade or so. Uh scarcity of supply is also going to be there. there's not a lot of large scale uh meaningful projects that are in the pipeline globally. Uh and our company for example is Stella. I'll give you this example. Um we have close to 17 million ounces in the ground, David. Um we trade at 220 million market cap Canadian dollar terms today. And if you were to start a company today and build that portfolio of assets, it will take 10 years and north of two billion uh to assemble um those ounces in the ground. And I think that's the value proposition for companies like us. And I think this is and it goes back to my earlier point about the fact that I think there's a bigger rerating rericing of uh gold and subsequently mining stocks and gold mining stocks in general and we haven't really seen that rotation yet. Stellar in itself. Tell us about just give us a rundown elevator pitch project deposit where you located pros and cons the jurisdiction and what what what are we looking at in terms of size and grade? Sure. So look, quick uh background context to the stellar story. We are a new company. Uh we formed this company back in early 2024, but it's the result of merging two previously longdated uh junior mining stocks on the Toronto Stock Exchange, Nighthawk and Monita. And both these projects have been around for more than a decade. We have two multi-million ounce large scale uh development gold projects in uh gold development projects in Canada, one in Northwest Territories and one in uh Ontario in Timman's mining jurisdiction. Both projects are easily capable of doing you know 300,000 ounce production profile and they have long mine lights as well. In addition to that, we have another old legacy site called Hollinger, which is an old tailings project right in the city of Timmans. And we just actually put a resource out on on this project. Uh currently has about half a million ounces of gold, most of which is in the indicated category and readily available for extraction given that there's a lot of excess milk capacity in the area. Right now at today's price, there's north of a billion of free cash sitting in that tailing spot. And uh we think that uh with the work that we've done and the advanced as we advance the project towards permits under the new mining uh regime and the laws uh the rules that uh allow these projects to be get permitted faster. We think we see a lot of opportunity for that as well. But uh projects have been around for a long time. Uh great projects the company's new and uh the merger of the two companies really was in response to going into 2023. it it was the worst market that I've seen and uh it was there was a lot of um there was a lot of talk about consolidation. It goes back to your point about having 1300 companies on the Toronto Stock Exchange and all the costs the corporate GNA cost that is required to maintain and you know carry these uh corporations. Uh that was in response to the consolidation and the merger of the two companies was in response um to a really difficult market uh in 2023. What are you doing now that gold is $4,200 versus what would you have been doing if gold were $2,000 2,000? Yeah, $2,1800 from before this rally. Yeah, look, great question. Uh we are a small cap name. We we obviously uh spend shareholder money and depends on how the markets are, how much capital we can raise. We're fortunate that we have a solid shareholder base and we've been uh we've been lucky to have uh had a you know supportive uh group of shareholders that have been there with us uh for the past four or five years. Um it it's really a question of capital allocation in relation to how much money you can raise and fiscally uh in a in a prudent way uh allocating that capital in a fiscally responsible way. Um for us right now uh given where we are at 4200 we're full throttle on advancing our core assets which is the Timmans portfolio that would be the tower goal project and Timmans and also the Hollinger project. So we are we've already started advancing those projects towards permits. We're doing all the technical work all the studies that are required uh to essentially get these projects towards uh FID uh in the next two three years. Um, and if the market and if we see a bigger rerating of our stock and you know uh there's more capital out uh available, we we're more than happy to turn the tap on advance our projects in Northwest Territories as well. Given that we have three projects and our flagship is the Timman's portfolio. Uh we'll also look at different uh strategies in terms of you know monetizing uh and leveraging the non-core assets to further advance uh uh our core assets uh with you know minimal dilution for our shareholders. Kayan, good talk. Uh best of luck for uh the development of your company. Give us one or two milestones that we should be watching for. Uh like I said, uh next year we we've started the the we started the advancement of the project in in Timman's uh Tower and Hollinger. Uh so there will be lots of uh news and catalysts along the way in the next uh 12 months in terms of how far we get uh with the baseline environmental work that we have to do and uh engaging with our First Nations and the local communities and so forth. Um we are at the PA stage so we're advancing that towards PFS over the next 12 to 24 months. So there will be announcements on that and we've also we're also going to start drilling uh our main project tower gold and Timonss uh is starting in January. So there'll be lots of uh news release on that as well. And look some of the other stuff as I said before in terms of looking at alternative strategies those are things that we are working on internally but I can't really comment on those obviously. Perfect. Appreciate your time Kavon and uh we will catch up with you again soon. Where can we find uh your information about you or your company in the meantime? Best place to visit uh us is obviously stellar gold.com. Uh we are active on social media so you can follow our channels. Uh there's we are we are heavily engaged with social media. I myself was engaged and I stopped and I'm going to start that again as well. So look for my own personal socials going forward and starting in 2026. And uh yeah, I'll leave you. Good. Thank you very much. Appreciate it. We'll put the links down. We'll put the links down below. So, make sure to follow Stellar Gold there. Kevon, we'll see you next time. Take care for now. Thanks, David. And thank you for watching. 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