Mr. Market Is Throwing Fat Pitches In Gold Stocks And Shorting Tesla Right Over The Plate Begging To Be Swung At

The markets sure have been wild since Trump went ahead with his tariff tantrum. Wall Street stocks were initially punished late last week, and this week the US debt is under pressure pushing yields higher.

US debt is driving up yields, exactly when Trump wants lower rates so he can spend more to drive the Death Spiral of Debt into a more unsustainable level. Made worse by the cost of servicing the debt.

Gold has come down from its record highs and is once again in a short-term coiled spring ready to blast to the upside.

Prior to Trump pulling the trigger on tariffs, many were thinking that they wouldn’t be aggressive. Instead of going with reciprocal tariffs, he went with punitive tariffs that were calculated based on the trade deficits, not based on being similar to what others charge.

The punitive tariffs are nearly impossible for trading partners to comply with because they are smaller economies and just can’t buy as much from America as America buys from them.

To make matters even harder to comply with, not only does Trump want other countries to buy as much as America buys from them, he also wants them to pay for past trade deficits. So much for kinder gentler tariffs, Trump has pushed his tariff chips all in.

Trump has also made it difficult to negotiate with him as he is being a bully, and can’t be trusted. If they negotiate, a bully will change the goalposts and want more. Worse, those that negotiate will have to enter into a lose-lose situation. It will make them enter into a deal with a bully and also flash a bright green light for investors to go short on them.

I’ve never been an active trader, but I also believe strongly in the concept that when Mr. Market throws fat pitches, you should swing for the fences. As I am seeing plenty of fat pitches, I am much more actively trading than I ever have in the past.

The fattest pitches are in the gold miners. High-cost gold miners are making around $1000 per ounce on every ounce they produce, and the low-cost miners are selling gold for around half of what it costs them to mine gold. They are free cash flow machines, which few other industries can say now, and with gold in a perfect storm to go much higher, things are only going to get better for the gold miners.

In my last report, I added a new gold miner to my list of picks, and also wrote about three gold stocks I bought shares in. Today, I bought shares in Heliostar Metals, they are a junior gold miner with the vision, team and assets to grow toward being a mid-tier gold miner.

I’m a big fan of their Ana Paula gold development project in Mexico. It is a high-grade gold development project, which is being moved ahead aggressively while there are very few high-quality gold development projects in the pipeline.

Another reason that I am a big fan of Heliostar is their CEO. He is a very talented geologist, he was part of the team that found Vizsla Silver’s fantastic Panuco project. He is still an advisor to Vizsla Silver that in addition to having great exploration potential is developing the project into a mine that is a Silvercrest lookalike that has the realistic potential to be even a bigger success. A key argument for that is if you look at their PEA, the project has an IRR in the triple digits using current gold and silver prices. There are very few gold-silver development projects worldwide with such remarkable statistics.

Heliostar’s CEO, Charles Funk is mainly focused on building his company into a mid-tier gold miner. Last year, he was able to buy an underloved gold mine that turned Heliostar from being an explorer into a junior gold miner. The assets they got also have the potential to be enhanced with exploration. Plus, the cash flow allows them to drive forward with Ana Paula without needing to issue a bunch of stock.

I’m working on scheduling an interview with Charles Funk for next week, so I will allow him to tell their story more fully to my audience in that interview. Stay tuned.

Another fat pitch that I have swung at three times this week is the Tesla leveraged bear ETF. When Tesla goes down, it goes up.

I am very bearish on Tesla. Due to Elon Musk’s DOGE efforts, he has angered a lot of his customer base. So the sales in America, Europe and other countries are dropping dramatically. In addition, they have recalled their Cybertrucks which will cost them a lot of money to fix. Now that Trump has gone all in on tariffs, that is going to increase costs for plenty of parts that are imported to build Tesla vehicles.

Even though Tesla’s stock has come down significantly from its record highs set in December, 2024, it still has an extremely high PE ratio. The stock is about to go through a Death Cross this week with a very steep drop in the 50-day moving average through the 200-day moving average.

The deterioration of the fundamentals and the technical indicators, suggest that there is plenty more downside. I have swung the bat three times at the Tesla leveraged bear ETF and they are all in the green. I will be looking to press my bets further before Tesla’s stock goes through its imminent Death Cross.

The slow pitches are coming in right over the plate and begging to be hit out of the park and I’m swinging the bat more often than I ever have in the past.

All the best,

Allan Barry Laboucan