L2 Capital

In today's episode, Marcelo spoke with Bill Sheriff, chairman of enCore Energy Corp., a uranium exploration company with mining assets exclusively in the USA.

Sheriff, who has worked as a geologist, a broker and a market maker, begins by talking about the history of Energy Metals, a company he founded with a market capitalization of US$1 million and sold a few years later for US$1.5 billion.

Bill Sheriff talks about the importance of having a properly qualified team at the helm of a uranium company, with technical expertise in the entire nuclear fuel cycle and presents the credentials of the enCore team.

Sheriff highlights the advantages of operating in the US, mainly in a historical context of the country as a consumer and producer of the raw material for the generation of nuclear energy.

When asked by Marcelo López about the expectations regarding the petition filed by his competitors under section 232, requesting market reserve for local uranium producers, Bill Sheriff comments on his vision and that of the company, how this would affect enCore as well as its expectation around the commodity price.

Following on, Sheriff comments on current market conditions, what he expects in terms of new projects worldwide, about his perception of market participants' sentiment and compares the current scenario to the one observed in 2004- 2007, along with a personal projection for the price of uranium in the coming years.

Bill Sheriff explains what the SWU is and what the role of this unit of measurement in the uranium universe represents, together with its relevance to industry analysis.

Asked about the mining restrictions on the outskirts of the Grand Canyon, Sheriff details what the current situation is, what may change in the near future, what impact it has on enCore operations and what they have to do with section 232.

Bill still talks about the latest technological innovations and the main risks he sees in the industry.

To know more about L2 Capital Partners, please check out our website!

The L2 Capital Podcast focuses on potential opportunities in the market, and brings to you industry leaders and intelligent conversation about their respective areas of expertise.

Follow us on social media:

• Twitter
• Linkedin
• Youtube

Follow our podcast on all platforms:

• Anchor
• Spotify
• Google Podcast
• Radio Public
• Stitcher
• Breaker
• Pocket Casts
• iTunes

In today's episode, Marcelo spoke with Jeffrey Snider, Head of Global Investment Research at Alhambra Investments, a Florida-based company that provides portfolio management services to institutions with a focus on risk management.

Jeffrey Snider is one of the few people to openly and consistently talk about the Eurodollar System and he spoke to Marcelo extensively about the subject in this episode.

Jeff begins by explaining exactly what the Eurodollar system is. It originated through US currency deposits outside the US and outside the US’s regulation, but evolved to become a large, interconnected global network with an enormous volume of transactions. It has been key to financial dynamics for some decades now.

Asked about how the system really works, Jeffrey Snider sets an example to clarify the mechanics behind it and the effects on the economy and the financial markets in general, noting that the opacity of the system justifies the “shadow currency” nickname.

Speaking about the financial crisis of 2007-2008, Snider brings a surprising perspective about what happened. In addition to pondering the share of subprime mortgages in the context of the crisis, he lists some of the various signs that point to Eurodollar as the factor that exacerbated the problem and led to the financial dimensions it got to.

Still about the crisis, Jeff comments on the Fed's reaction and the adoption of quantitative easing (QE), drawing an elaborate and interesting explanation on the state of the world's monetary system and the ability of central banks to deal with the situation.

To conclude, Jeffrey Snider describes China's role and exposure to the Eurodollar market and provides insight into how to position oneself in regards to our own investments, in order to profit from the possible outcomes that he mentioned.

To know more about L2 Capital Partners, please check out our website!

The L2 Capital Podcast focuses on potential opportunities in the market, and brings to you industry leaders and intelligent conversation about their respective areas of expertise.

Follow us on social media:

• Twitter
• Linkedin
• Youtube

Follow our podcast on all platforms:

• Anchor
• Spotify
• Google Podcast
• Radio Public
• Stitcher
• Breaker
• Pocket Casts
• iTunes

In this special episode Marcelo López shares his insights on the uranium investment thesis.

It has been recorded in Portuguese.

Please share it with your Portuguese-speaking friends.

-

No episódio especial de hoje, invertemos os papéis. Marcelo López ocupou o lugar de convidado num bate-papo com Rafael Siqueira sobre a oportunidade de investimento em urânio.

Quer entender por que a L2 Capital acredita tanto na tese de investimento em urânio? Compartilhamos com você de forma clara e abrangente as conclusões das análises dessa oportunidade que está fora do radar dos investidores.

Marcelo conta sobre sua trajetória no mercado financeiro, sua experiência como hedge fund manager em Londres, como se deparou com essa tese e o que o motivou a ir mais a fundo para entender as peculiaridades do setor.

Após viajar por diversos países, dedicar muito tempo e recursos, e conversar com todos os players do setor, como executivos de mineradoras, de usinas nucleares (utilities) e de enriquecedores, geólogos e analistas, Marcelo identificou no urânio uma oportunidade que ele considera ímpar.

Nesse podcast, Marcelo responde às principais perguntas dos investidores.

Por que os preços estão tão baixos e como eles chegaram lá? Marcelo explica detalhadamente como uma confluência de fatores contribuiu para a queda da commodity.

O que mudou nesses fatores desde então?

Como é a dinâmica do setor, os aspectos da demanda, da oferta e do preço?

No que devemos prestar atenção ao analisar o setor?

O que está puxando a demanda?

Como a oferta está reagindo ao cenário?

Qual o preço de equilíbrio?

Como foi o último bull market e quais fatores o impulsionaram?

O que o atual bull market tem de diferente do último?

O que esperar daqui para frente?

Qual o horizonte para consolidação da tese?

Quais são os catalisadores?

O que é a petição da Section 232 e qual o impacto dela para o mercado e para os investidores?

Como se posicionar para lucrar com a correção dos preços?

Tudo isso trazido a você de forma direta e informativa.

 To know more about L2 Capital Partners, please check out our website!The L2 Capital Podcast focuses on potential opportunities in the market, and brings to you industry leaders and intelligent conversation about their respective areas of expertise.Follow us on social media:

• Twitter
• Linkedin
• Youtube

Follow our podcast on all platforms:

• Anchor
• Spotify
• Google Podcast
• Radio Public
• Stitcher
• Breaker
• Pocket Casts
• iTunes

In today's episode, Marcelo Lopez spoke with Alex Molyneux, a senior executive and investor in natural resources, who today acts as an advisor to an investment fund solely focused on capturing opportunities in the uranium market.

Having already held various executive positions in companies in the sector, as he himself explains, he is able to have a deeper technical understanding of uranium particularities, such as operational issues, production, licensing and jurisdiction, which gives him a different approach when investing.

Alex Molyneux curriculum gives him credibility to talk about uranium. After a decade working as a specialist mining investment banker at large banks in locations such as Melbourne, Beijing, London and Hong Kong, he took up executive positions in publicly traded mining companies, founded a uranium mining company, Azarga Uranium, and held the position of CEO of Paladin Energy during its restructuring phase.

Asked about what he considers important in the pursuit of investment objectives in the sector, Alex talked about what aspects he prioritizes in the analysis and comments on what his expectations for the price of uranium are.

Marcelo asks about the recurring assertion that excess inventory is putting pressure on the commodity and it is responsible for the current low price. Alex Molyneux draws up a detailed explanation of different types of inventory, such as those held strategically by governments and those held by utilities. He also talks about the trends he observes and the perspectives he has for each type of inventory, as well as the impact of this on the market.

Alex also comments on the long-term contract maturities and the uncovered demand for nuclear power generators with the insight of someone who was the main executive of the world's second largest pure-play uranium company.

When questioned as to why utilities are not taking advantage of low prices to buy more uranium, Alex clarifies how they deal with price and what actually motivates them to enter into contracts. He draws a parallel to the latest bull market and lists the factors that are influencing the current scenario.

Alex Molyneux then gives his insight into the relevance of the Separative Work Units (SWUs) and what the price and volume dynamics of the spot and long-term market should look like from now on.

What price range is required for the start up or ramp up of production projects? How long will it take to reactivate the McArthur River mine? Will there be an overshooting in the price? Is it possible to cover the production deficit in the coming years? Alex gave his opinion about all of this.

When it came to KazAtomProm, Alex gave his point of view on the company’s production costs, capex, and the impact the exchange rate has on the company's decisions. He also talked about the role KazAtomProm has as an asset to compose a uranium-focused portfolio.

Finally, Molyneux, who has worked as an investment banker focusing on mining, discusses the challenges that uranium producers could encounter if they need to obtain funding to bring projects online.

To know more about L2 Capital Partners, please check out our website!

The L2 Capital Podcast focuses on potential opportunities in the market, and brings to you industry leaders and intelligent conversation about their respective areas of expertise.

In today's episode, Marcelo Lopez spoke with Simon Mikhailovich, co-founder and manager of the Tocqueville Bullion Reserve, which he describes as a global solution for those who wish to have gold and make use of a complete infrastructure with fiduciary responsibility and alignment of interests, allowing the purchase directly from the refiners.

At the beginning of the conversation, Simon draws a distinction between having gold as a form of investment and having it as a safe haven. For both cases, he highlights how to position and the incredible features of the yellow metal.

Simon and Marcelo conduct an interesting discussion of gold price performance since the peak in 2011, and ponder the effects of asset inflation, central bank intervention, currencies, confidence and how the “insurance policy” works.

Simon Mikhailovich makes a detailed analysis of the differences between the sentiment and behavior of Americans, Russians and Chinese in relation to the acquisition of gold, with a historical and political context for each.

Asked if gold is the only way to protect oneself and where to keep it, Simon elaborates with a thorough explanation of the weaknesses of the global financial system, compares gold to other real assets and underlines what makes it unique when it comes to protection and practicality.

After Marcelo brings some recent examples of consolidation activities among gold mining companies, Simon Mikhailovich explains how the prices, the expectation and the dynamics of gold extraction are the catalysts for the mergers and acquisitions that are happening in the sector, besides commenting on his perspective on this issue.

Simon, who has extensive experience as a derivatives investor, having made money on the way up and also on the way down in the last cycle, argues that derivative contracts represent a major risk to the system and discusses his macroeconomic outlook, including global indebtedness, asset pricing and possible consequences for the markets.

Specifically on the US government borrowing and central bank actions, Mikhailovich assesses the current situation, the implications of the policies adopted, underscores the importance of the issue of trust and compares the current scenario with the latest financial crises.

Asked about the importance of the price of gold, Simon Mikhailovich ponders about purchasing power, nominal and real values and cites historical examples of the commodity price relative to other assets to substantiate his view on the subject.

To know more about L2 Capital Partners, please check out our website!

The L2 Capital Podcast focuses on potential opportunities in the market, and brings to you industry leaders and intelligent conversation about their respective areas of expertise.

In today's episode, Marcelo López talked to Marc Faber, editor and publisher of the famous report Gloom Boom & Doom and a contrarian investor known for bold investment decisions in the past.

Marcelo begins the conversation by asking about the behaviour of markets from December 2018 to the present. Marc Faber attributes the December declines and reaction seen in 2019 to a number of factors, including the Fed’s capitulation, Modern Monetary Theory and the flow of investor’s capital. He also brings his perspective to the stock market in 2019 and comments on the possibility of a crash.

Following on, Marc discusses the monetary policy of the Fed and other central banks, about their recent decisions, asset bubble, Quantitative Easing (QE) and his expectation regarding the next steps that will be taken by the American central bank. He also talks about the economy in some European economies, in the US, in Japan and in China.

Marc Faber comments on the possibility of a recession in the US and China, for which he makes an interesting sector analysis, highlighting sectors that may suffer great contraction and others that may even benefit by an expansion.

Marc then reflects on the impacts of monetary expansionism on the real economy, on the effectiveness of this kind of policy as a growth stimulus and he cites the examples of Japan and Europe.

Faber, who has almost 50 years of investment experience, talks about negative interest rates and gives his opinion on why investors would look for assets with this so unusual feature.

When questioned about where to find yield at the moment, Marc Faber talks about the countries he follows in Asia, especially Vietnam. As for his expectation on the foreign exchange market, he mentions some emerging currencies and what he thinks about how the US dollar should behave in the long run.

When it came to America versus Emerging Markets stock market, Faber offers his insights into how the relative pricing between them is at the moment and what he considers the best strategy to profit from this difference.

Regarding commodities, Marc stated specific examples of how some types may perform according to the global economic environment and also gave his assessment as to the current pricing of the asset class as a whole.

Specifically on gold, Faber talks about his views on the metal as a form of investment, especially in the current context of high liquidity injected by central banks.

Finally, Marc highlighted those he believes are the main risks to the financial markets and asset prices, such as the issue of political polarization and China's slowdown.

To know more about L2 Capital Partners, please check out our website!

The L2 Capital Podcast focuses on potential opportunities in the market, and brings to you industry leaders and intelligent conversation about their respective areas of expertise.

In today's episode, Marcelo López talked to Marc Faber, editor and publisher of the famous report Gloom Boom & Doom and a contrarian investor known for bold investment decisions in the past.

Marcelo begins the conversation by asking about the behaviour of markets from December 2018 to the present. Marc Faber attributes the December declines and reaction seen in 2019 to a number of factors, including the Fed’s capitulation, Modern Monetary Theory and the flow of investor’s capital. He also brings his perspective to the stock market in 2019 and comments on the possibility of a crash.

Following on, Marc discusses the monetary policy of the Fed and other central banks, about their recent decisions, asset bubble, Quantitative Easing (QE) and his expectation regarding the next steps that will be taken by the American central bank. He also talks about the economy in some European economies, in the US, in Japan and in China.

Marc Faber comments on the possibility of a recession in the US and China, for which he makes an interesting sector analysis, highlighting sectors that may suffer great contraction and others that may even benefit by an expansion.

Marc then reflects on the impacts of monetary expansionism on the real economy, on the effectiveness of this kind of policy as a growth stimulus and he cites the examples of Japan and Europe.

Faber, who has almost 50 years of investment experience, talks about negative interest rates and gives his opinion on why investors would look for assets with this so unusual feature.

When questioned about where to find yield at the moment, Marc Faber talks about the countries he follows in Asia, especially Vietnam. As for his expectation on the foreign exchange market, he mentions some emerging currencies and what he thinks about how the US dollar should behave in the long run.

When it came to America versus Emerging Markets stock market, Faber offers his insights into how the relative pricing between them is at the moment and what he considers the best strategy to profit from this difference.

Regarding commodities, Marc stated specific examples of how some types may perform according to the global economic environment and also gave his assessment as to the current pricing of the asset class as a whole.

Specifically on gold, Faber talks about his views on the metal as a form of investment, especially in the current context of high liquidity injected by central banks.

Finally, Marc highlighted those he believes are the main risks to the financial markets and asset prices, such as the issue of political polarization and China's slowdown.

To know more about L2 Capital Partners, please check out our website!

The L2 Capital Podcast focuses on potential opportunities in the market, and brings to you industry leaders and intelligent conversation about their respective areas of expertise.

In today's episode, Marcelo Lopez spoke with Alasdair Macleod, who besides being a very experienced investor, is the Head of Research at Goldmoney.

Alasdair talks about Goldmoney acting as custodian for clients around the world who wish to store precious metals outside the banking system and also the interesting services it provides to its investors.

When questioned about the recent market performance, marked by pronounced declines in late 2018 and a bullish reaction in January 2019, Macleod explains these events and establishes a connection between decisions made by the Fed, the stage of the credit cycle and economic protectionism, in addition to giving his vision of what to expect for this year.

He also draws a distinction between the credit cycle and the business cycle and highlights the factors that characterize the current cycle and uses recent data to give an opinion on the stage we are in today.

Asked what the direction of central bank interest rates should be in the face of current circumstances, Macleod gives his prognosis for rates, as well as its consequences for the economy and markets.

He then discusses inflation measured by governments around the world and points to the discrepancy between what is seen in practice and what is recorded by official price indexes. 

When asked by Marcelo about what can be expected of the performance of gold in the scenario that is being drawn, Alasdair highlights the metal's ability to preserve the purchasing power of those who have it in situations of currency devaluation and cites historical examples to prove his point.

Macleod then shares his view on investments in gold stocks as well as ETFs and how they can react in scenarios of global deceleration and appreciation of the commodity.

He reveals his expectation for Fed decisions from now on and draws a parallel between the crisis of 1929 and today, highlighting the current unprecedented factors such as high public debt and deficits and dependence on foreign borrowers. Besides that, Alasdair conjectures the impacts of these potential decisions to the dynamics of interest rates.

Alasdair also brings a positioning of the electorate on the political spectrum. About Brexit, he meticulously comments about the stage of the process and the impacts that could be felt in the markets.

Finally, responding to a request for guidance on how to position the portfolio to deal with the events he believes are on the way, Macleod talks about analogous situations of the past, specifically about Germany in the 1920s. 

To know more about L2 Capital Partners, please check out our website!

The L2 Capital Podcast focuses on potential opportunities in the market, and brings to you industry leaders and intelligent conversation about their respective areas of expertise.

In this episode, Marcelo Lopez spoke with Brandon Munro, CEO of Bannerman Resources Limited, a company listed on the Australian Stock Exchange, ASX, focused on the exploration and development of uranium mines.

Munro begins by telling a little about the company's history, as well as about his trajectory within the company, from the acquisition of the Etango Project in Namibia, various studies and licenses and the way the company handled the accident at Fukushima nuclear power plant in 2011.

Asked by Marcelo about the country where the company's activities are concentrated, Brandon explains with the knowledge of those who had lived there for several years, mentioning that Namibia contradicts the stereotype that the West has about the African continent. He highlights the characteristics that differentiate Namibia from other countries, emphasizing the quality of its road and port infrastructure, its political stability and the inheritance of German colonization.

Next, Munro provides a detailed explanation of the recent dynamics of uranium spot prices in the face of the trajectory to the current US$30/lb, highlighting events that have modified the demand, such as the emergence of specialized investment vehicles in the acquisition of the commodity . He also shows how he sees price behavior going forward, the levels that may be decisive for the reaction of market participants, and their impact on industry action.

Munro then shares a thorough analysis of how long-term contracts have always dominated the scene, while the spot was negligible and served only as a balancing mechanism. According to him, the Fukushima incident created a huge distortion in the market, profoundly altering the dynamics of the contracts. Brandon points out that we are in an unprecedented situation for this industry, which could significantly boost the bull market of the commodity.

Asked about the latest bull market, Brandon points to how prices rose from about US$20/lb to US$136/lb very rapidly and talks about the similarities with the 1970s. He emphasizes that current prices are unsustainable in view of production costs and that the only way out would be a huge increase in prices, possibly to multiples of current levels. He bases his argument with an estimate for the minimum price that would bring the market back to equilibrium.

Munro brings some of his vision about sentiment in relation to the commodity, going from the recent lack of interest from investors and getting to a situation in which more and more attention is given to the sector. He still explains and cites examples of why the stock prices did not follow the commodity price over the last few months.

Asked about Section 232, Brandon outlines different scenarios of what Trump's response to the request might be, on the grounds of strategic and national security point of view. He also mentions what he believes will be the implications for the companies in the uranium sector.

Munro also talks about his perspective on pricing scenarios and the performance of the two largest companies in the industry, KazAtomProm and Cameco. Regarding the latter, he still discusses the impacts of Cameco’s decision to put its largest mine in care & maintenance and to buy uranium on the spot market to honor its contracts, instead of producing.

Brandon then gives a real lesson on how uranium stocks work, highlighting the operational characteristics of each type, levels, potential for enrichment and its impacts on the market and price volatility.

Munro also talks about what the stock investor should look for when looking for uranium-related assets. He points out that there are few companies that are accessible in the industry and that many have specific risks, not related to the commodity itself, but to jurisdiction, for example.

Brandon concludes by commenting on the feeling about uranium and atomic energy as an alternative energy, comparing i

 In this episode, Marcelo talks to Martin North, from Digital Finance Analytics (DFA). DFA is a boutique research, analysis and consulting firm providing advisory services to clients in Australia and beyond.  

Martin starts by explaining how his company, DFA, conducts the research and consulting work. DFA follows a philosophy of its own and looks at different perspectives, with a wealth of detail.

Following on, North talks about the downward trajectory of real estate prices in Australia in 2018, which he had already anticipated, after several years of expressive appreciation. He explains why prices have risen so robustly over the last few decades and shares his point of view for the near future.

Asked about credit expansion and the granting of real estate loans, Martin presents recent numbers and market trends and highlights the strong influence of investors, including foreigners, in this sector. He further clarifies how rising property prices have led to a change in household indebtedness and composition of the budget - and the consequences for the economy as a whole.

Martin, when asked about the report published by the Banking Royal Commission on February 4, highlights the main points of the document and analyzes the problems with the banking system and the country's indebtedness and how they constitute a potential problem for the national economy. He also compares the situation in Australia with the 2007-2008 Global Financial Crisis in the US.

Marcelo comments on the fact that a significant portion of households have negative equity and asks about the upcoming decisions of the Australian central bank, the Royal Bank of Australia, regarding interest rates and the impacts of this for the real estate sector. Martin comments on what he thinks will be the decision of the monetary authority in the face of the economic situation and still points particularities of different regions of the country and how they can be determining factors in the way that real estate prices will behave.

An important and interesting risk is questioned by Marcelo regarding the quality and construction standards adopted in the country and Martin, besides explaining the reason for this risk, reiterates his point of view that many properties may turn into chanty towns in the future and highlights the turn from excess demand to excess supply.

Are there more risks that people are not paying attention to? Martin North highlights Australia's strong link with China, rising funding costs, and political risk: elections in the country can lead to the termination of negative gearing. In addition to these, North believes there are many other risks that lead him to believe that the downside far outweighs the upside.

Finally, Martin explains why Australia is heading for a complicated period for the next 5 years, and why 2019 will probably be what 2006 was for the United States in relation to the financial crisis.