Gold’s Role in an Uncertain Global Economy: Why Austin Gold (NYSE American: AUST) may be Poised to Benefit

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Gold has experienced a tremendous runup in 2024, surging from under $2,100/oz to over $2,700/oz in a matter of months. Experts at Goldman Sachs predict that gold prices will continue to rise, which could provide a massive tailwind for companies like Austin Gold (AUST). Austin Gold is the only pre-discovery gold exploration company listed on the NYSE American and presents investors with a unique way to take advantage of a continued bull run for gold.

Why buy gold in 2024? 

Investors tend to view gold as a “safe haven” investment known for retaining value over time and performing well during periods of economic uncertainty. Some experts believe that gold could continue to perform well in 2024 for four reasons:

• Increased demand from central banks: ​According to a Central Bank Gold Reserves (CBGR) survey from early 2024, 29% of central banks intended to increase their gold reserves in the next twelve months – the highest level since 2018.
• Economic concerns: Central banks are stocking up on gold mainly due to concerns regarding economic crises and inflation, per the CBGR survey. While inflation in the U.S. has slowed in recent months, there is still a chance that this trend could reverse.
• Rising geopolitical tension: Conflict in the Middle East continues to escalate, increasing uncertainty in global markets. Meanwhile, the United States is set to experience one of the most polarizing elections in recent memory. Since increased political unrest could potentially hurt the stock market, many investors are opting to stock up on gold.
• Falling interest rates: The Federal Reserve recently cut its benchmark rate by half a percentage point, a trend that may continue over the coming months. When interest rates fall, the return on alternative investments like bonds and savings accounts also decreases. This makes gold, which doesn't pay interest, a relatively more attractive option.

For these reasons, gold’s outlook for 2024 and into 2025 remains strong. But, investing in physical gold can be tricky as it often requires hefty storage fees and can be difficult to sell. To avoid these roadblocks, many investors choose to invest in gold stocks. 

Benefits of investing in gold stocks

Investing in gold stocks shares many of the benefits associated with owning physical gold, without the headache of buying and storing physical gold. Common benefits of buying gold stocks include: 

• Greater stock appreciation: As gold prices rise, gold mining companies' profits can increase exponentially, leading to a greater return when compared to gold’s price change.
• Easier to liquidate: Selling gold stocks is generally simpler and faster than selling physical gold.
• No storage fees: Owning gold stocks does not require any storage or custodian fees, which can help improve returns over time.

In particular, some investors have shown interest in owning shares of pre-discovery gold companies. These are companies that are actively exploring for gold but have yet to make a substantial discovery. By owning shares in a gold exploration company – like Austin Gold – investors can get exposure to gold while also benefiting firsthand if a discovery is made. 

Austin Gold is one of the top gold exploration companies and is currently exploring three different projects. This under-the-radar company could present a rare opportunity for investors to capitalize on gold’s continued bull run. 

Austin Gold: a top gold exploration stock? 

One of the first things to look for when examining a company is its team. In Austin Gold’s case, the principals have an extensive reputation for developing successful mining projects and have already achieved billion-dollar market capitalizations with three previous companies:

• Pretium Resources (which was acquired by Newcrest Mining)
• Silver Standard Resources (now SSR Mining (SSRM))
• Uranerz Energy (which was acquired by Energy Fuels (UUUU)) 

This team is looking to recreate success for the fourth time and is currently exploring two of their three projects:

• Lone Mountain in Elko County, Nevada
• Stockade Mountain in Malheur County, Oregon

Exploring more than one project simultaneously is a strategic decision as it helps create multiple opportunities for gold discovery.

Austin Gold’s most promising project is Stockade Mountain, as recent drilling showed that mineralization is robust and the project contains significant gold grades.. Austin is planning a reverse-circulation drill program to follow-up on the encouraging gold mineralization encountered during the 2023-4 winter drilling program. Austin's drilling program is designed to test beneath known high-level gold/silver-bearing stockwork mineralization for high-grade vein deposits formed deeper in the hydrothermal system. Only further exploration will determine how much gold lays beneath the surface.

Another key detail for investors to know is that Austin Gold is incredibly well-funded, a crucial element for exploration companies. According to its unaudited Q2 2024 financial statement, Austin Gold has $7.4 million in current assets and just $87,000 in current liabilities. This gives the company plenty of runway to continue exploring for precious metals across all three projects. 

Investors looking to capitalize on a continued bull run by gold may also want to follow along with Austin Gold and even consider taking a position. The best time to invest is typically before a significant discovery has been made.

To learn more, check out Austin Gold’s most recent update on its exploration efforts at Lone Mountain and Stockade Mountain.

Learn More About Austin Gold (NYSE American: AUST)

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