THESE Mining Stocks to Profit in Coming Crisis 'Worse Than Great Recession': Mining Stock Monkey

Key Concepts

Downside Protection: An investment strategy prioritizing the preservation of capital to avoid large losses, which require disproportionately high gains to recover.
Loan-to-Value (LTV) Ratio: A financial metric comparing the amount of a loan to the value of the asset purchased; high LTV ratios (e.g., 130%) increase default risk.
Royalty and Streaming Companies: Firms that provide upfront capital to miners in exchange for a percentage of future production or revenue, offering lower operational risk than traditional miners.
All-In Sustaining Cost (AISC): A comprehensive metric used in the mining industry to represent the total cost of producing an ounce of gold or pound of copper.
Free Carried Interest: An arrangement where a government or partner holds an equity stake in a mine without being required to contribute to capital expenditures.
Macro Tailwinds: Economic factors (e.g., sovereign debt, dollar weaponization) that support the long-term appreciation of an asset class like gold.

1. Economic Outlook and Recession Indicators

Jordan argues that the U.S. economy is showing significant signs of stress, suggesting a high probability of a recession. Key indicators include:

Consumer Debt: Record levels of credit card debt, with a bifurcation where the bottom 60% of earners are struggling.
Buy Now, Pay Later (BNPL): The rapid growth of BNPL services—often used for daily necessities like groceries—is creating a "hidden" debt burden that is not fully captured by traditional credit reporting agencies.
Subprime Auto Loans: Delinquency rates are at a 30-year high. Many consumers are "rolling over" negative equity from old vehicles into new loans, resulting in LTV ratios of 120%–130%. This creates a balance sheet risk for banks, as repossession at auction (typically recovering only 70% of value) results in massive losses.
Student Loans: Delinquency rates have jumped from 1% to 16%. Upcoming payment increases in July 2026 are expected to further contract consumer spending.
Consumer Sentiment: Currently at record lows, which historically precedes a decline in economic spending and GDP growth.

2. The Gold Bull Market

The current gold bull market has lasted 124 months, nearing the historical record of 125 months.

The Dilemma: While macro factors like sovereign debt and the weaponization of the U.S. dollar support gold, the cycle is "entering overtime."
Strategy Shift: Jordan emphasizes that as a bull market matures, the risk-reward profile for producers deteriorates. A 30% drop in gold prices can lead to a 60% collapse in margins for producers, whereas royalty/streaming companies maintain stable margins (often ~90%) regardless of price fluctuations.

3. Royalty and Streaming Analysis

Jordan compares the "Big Three" royalty companies:

Franco-Nevada: Possesses the largest "war chest" of cash and credit but has the lowest organic growth profile (~14%).
Wheaton Precious Metals: Offers the most significant near-term growth (nearly 50% over the next few years) based on existing contracts.
Royal Gold: Positioned for strong growth over a 6-year horizon, potentially rivaling Franco-Nevada in size. Jordan dismisses concerns regarding their 30% equity stake in the Högland (Hod Modern) project, noting that the project’s AISC (under $600/oz gold) makes it highly profitable and manageable via cash flow.

4. Risk Management and Exit Strategies

Jordan’s investment philosophy is built on "protecting the downside."

Exit Strategy: He recently sold Endeavor Mining due to rising geopolitical risks in West Africa (Burkina Faso, Mali), where governments are effectively "stealing future value" by increasing royalty rates and demanding higher free-carried interest.
FOMO Control: Jordan avoids "10-bagger" chasing, preferring consistent 2x–3x returns. He views investing like baseball: "There are no called strikes." If an opportunity doesn't meet his strict criteria for downside protection, he passes, even if the stock later performs well.
Mathematical Discipline: He notes that a 90% loss requires a 900% gain to break even, making capital preservation the primary driver of long-term wealth.

5. Notable Quotes

"If you can avoid losing money where the winners take care of themselves, you can build wealth very fast."
"I don't know if this bull market is going to go on longer than previous ones... because I don't know, this makes me want to shift some of my investments."
"[Regarding the West African mining environment] They aren't outright appropriating the mines, but they are stealing the future value of the mine."

Synthesis

The core takeaway is a cautious, defensive posture. Jordan suggests that investors should prepare for a potential recession by favoring high-quality, low-risk assets like royalty and streaming companies over traditional miners. By focusing on companies with strong balance sheets and avoiding the "gambler's mindset" of chasing high-risk, high-reward stocks, investors can preserve capital and position themselves to capitalize on market corrections when they occur.