Canada's Problem not Trump, Zonte, ZON
Copper
Tariff flip flop as Premier Ford agreed not to implement 25% surcharge on electricity and Trump backed away from an additional 25% tariff hike. Again, I will mention how unfair Canada's trade policy is, especially in U.S. eyes. Canada has up to a 290% tariff on dairy and up to 170% on poultry products. There is no foreign ownership allowed in Telecom so the big three providers in Canada have a monopoly with high prices. Canada implemented a digital services tax last June that mainly hits the U.S. tech giants like Facebook and Google. There is more, but those are the four biggies.
My biggest fear is too many Canadians get bamboozled on all this Trump/tariff propaganda that Liberals and the NDP can get voted in again, next election. All the problems Canada has, started long before Trump and his tariffs came along but our politicians are trying to divert Canadians from the real problems they created.
From another expert - “Our real problem in Canada is our anti-business culture,” says Philip Cross, a former chief economic analyst with Statistics Canada, and now a senior fellow with the Macdonald-Laurier Institute. “Apart from tariffs, [Trump] is doing a lot of other things, like cutting corporate taxes and regulations and everything else that make the U.S. a much more attractive place to operate as a business. That’s the real threat, not the tariffs,” he said.
Recently Canada, New Brunswick’s Irving Paper said it’s closing half of its operations in the province, Apple announced a US$500 billion investment in the United States. Previously Irving
announced a US$600 million expansion to its operations in Macon, Georgia, in late November. So really Irving is moving more so from Canada to U.S.
Apple’s announcement came on the heels of Saudi Arabia committing to a US$600 billion investment in the United States in January, and an Emirati businessman pledging US$20 billion to build data centres in the country earlier the same month.
Meanwhile, U.S. President Donald Trump’s top economic adviser is accusing Canada’s law enforcement agencies of not taking enough action on fentanyl labs, while reiterating previous comments from the U.S. administration that the tariffs put on Canada are part of a “drug war, not a trade war.”
“I can tell you that in the Situation Room, I’ve seen photographs of fentanyl labs in Canada that the law enforcement folks were leaving alone. Canada’s got a big drug problem, even in their own cities,” U.S. National Economic Council Director Kevin Hassett said on ABC News on March 9.
This is what is really going on. I have read again Sam Cooper's book and I will have a complete newsletter on the China/Canada Fentynal trading boom with a historic to present day perspective. It will blow you away!!!!!!!!!
And I might mention, on February 24, Germany became the latest country where voters rejected a left-leaning government largely because of their unhappiness over immigration and the economy.
Germany’s next chancellor is likely to be Friedrich Merz, a former corporate lawyer who promised to crack down on migration, cut taxes and regulation and adopt a hawkish policy toward Russia.
Merz leads a center-right alliance that finished first in the election, with 29% of the vote. A far-right party, Alternative for Germany, that promises even tougher immigration policies — but is friendly toward Russia — finished second, with 21% of the vote. The center-left Social Democrats, who led the government for the past four years, tumbled to third place, with 16% of the vote. It was their worst showing in a national election since at least 1890.
Inflation Cools but Natural Gas Hot
The consumer price index for February showed that the core inflation fell amid signs of consumer caution. Both the CPI and core CPI rose 0.2% on the month, below the 0.3% Econoday consensus. The headline inflation rate eased to 2.8% from 3% in January, while core CPI inflation fell to 3.1% from 3.3%. That's the lowest since April 2021
Core goods prices rose 0.2%, boosted by a 0.9% in used car prices and 0.6% increase in apparel prices. I was expecting higher inflation in the first half of the year and easing in the 2nd half but it is now obvious a U.S. recession is coming much quicker. This is going to dampen consumer demand and will also slow energy demand an likely mean lower oil prices. The odds of a peace deal in Ukraine are increasing so this will be a little bearish for oil too, especially if Russia sanctions get lifted down the road.
Interesting was Henry Gas Hub Balloons Out of Control.
US natural gas prices soared to $4.47 per mmBtu in Monday trading, marking the highest reading since December 2022, buoyed by Canadian gas imports dropping by 1 Bcf/d to 8.7 Bcf/d over the past week and record LNG feed gas demand.
Canada has very poor and slow data on oil and gas production and inventories as well as other commodities and data. By the time it is published, it is irrelevant. However what the action indicates Monday is that Canada Natural Gas inventories must have got very low with the cold winter. We won't know actual data for another 2 or 3 months. Like I say, pretty useless. How can we manage this county when we cannot even measure what is going on.
Now for some better news, Zonte announced their largest anomaly to date and by a huge margin.
Zonte Metals - - - TSXV:ZON, OTC:EREPF - - - Recent Price - $0.065
Zonte announced the advancement of the Nine Mile target with the discovery of its fifth large gravity anomaly, on its Cross Hill Copper Project in Newfoundland. Highlights from Nine Mile target:
The discovery of a strong 5 mGal gravity anomaly.
The gravity anomaly has significant size, with dimensions up to 3700 metres by 3100 metres and +900 metres deep, and open to the south.
The gravity anomaly sits in a complex structural zone that could have provided mineralizing fluid pathways, enhancing its potential.
Terry Christopher, President and CEO, comments: “The discovery of this large, strong gravity anomaly at Nine Mile is a significant discovery for Zonte, being its fifth large-scale gravity anomaly outlined within the project. A portion of the new anomaly is positioned at a flexure in the Cross Hills fault and intersected by multiple fault sets.This structural zone may have acted as a conduit for fluid movement and a potential trap for mineralization. At the surface, above the anomaly, copper has been identified in rocks, while copper-in-soil anomalies have been identified where the soil sampling has been completed. When strongest portions of the anomaly are examined, two separate target areas are highlighted; a northern one sitting within a structural zone within the strongest magnetic signature at Nine Mile and a southern one which is close to the K6 copper bearing drill holes. The K6 discovery points to a fertile copper system and the spatially relationship to several recently outline gravity anomalies highlights the potential for discovery. The newly defined target area will be the focus for the additional exploration to take it to drill stage, as soon as the snow melts.”
Just because drill holes from K6 look close, it does not necessarily mean they just missed the target. Zonte will do more work to refine drill targets on this new anomaly and is in the process of planning additional sampling and mapping throughout the newly defined target area. This work will commence shortly.
CEO Christopher tells me he had a very productive PDAC, meeting many new contacts.
The stock has created a Stage 1 base the past 2 years, mostly between 6 and 10 cents. Anytime the stock is near the bottom of this base I believe it is a great buy. Key will be to break above 10 cents and then a move to resistance would be about a 200% move from current prices.
There are a few short term catalysts that could move the stock. 1- Copper prices – I last highlighted copper about a month ago that it had broken out of a wedge pattern and above resistance. Today, copper made 9 months high and I expect it will soon test all time highs, just over $5.00.
2 - A deal with a major mining company on Cross Hills and today's news should tweak more interest.
3 - A strategic investor into the company.
4 – A turnaround in the junior exploration market, although this looks like several months away yet.
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