James West: First Was Crypto, Now Cannabis, Next Up Commodities

Canada has catalyzed the conversion of the Midas Letter from a mining centric to a broader multimedia digital platform that are now focused on video production. Recently they have focused on the hottest markets. Lately, that has been the cannabis industry. Canada has stolen the spotlight for this market, and they are working on a documentary about it. Midas Letter has launched a series of indexes for cannabis companies which have done well from 6.4x to 15x over the past couple of years.

He thinks the bubble in cannabis will burst as the cost of production falls later this year. Many “non-licensed” companies will deliver cannabis to your door very quickly at a fraction of the cost of the licensed establishments. Three billion has been invested into the cannabis space so far this year in Canada, and some forty plus billion has entered it over the last few years.

By mid-2019 a lot of money will flow into the resource sector. Gold currently is struggling and that may in part because of the younger generation has been looking at crypto. There is a broad perception that the days of fiat and commodity backed currencies are coming to an end. He doesn’t agree with that concept and is buying mining stocks.

Copper will be significant in the next cycle and to lesser degrees lithium and cobalt due to the electric vehicle revolution. Battery demand is driving demand for these materials. There is a risk of supply-side shocks with copper in Chile due to union demands. He discusses the various companies in the space.

Talking Points From This Weeks Episode
• The next commodity cycle will be different.
• Cannabis bubble is likely to pop in Canada later this year.
• Next resource cycle will be lead by Copper, Lithium, and Cobalt.
• Copper supply shocks are possible.

James West is publisher and editor of The Midas Letter, an independent capital markets entrepreneur and investor. He has spent more than 20 years working as a corporate finance advisor, corporate development officer, investor relations officer, media relations and business development officer for companies involved in mining, oil, and gas, alternative fuels, healthcare, internet technology, transportation, manufacturing, and housing construction.