Page 1

Markets Plunge 8% Year-to-Date in2016, Reminiscent of 2008 DeclineChina's single day 7% decline and halt to trading in December proved to be a harbinger of things to come in global markets.

The S&P 500 plunged by 6% during January, in the worst ever start to the calendar year for stocks.

Through the first week of February, the S&P 500 dropped 8% and the NASDAQ is down 13%.

Over $15 Trillion in market capitalization has been lost in the past six months.

The unemployment rate may have dipped below 5.0%, but only 151k jobs were created versus expectations of 190k.

Furthermore, over 60% of the jobs added to the economy in January fell below the measured median-wage range,with the majority of new positions falling into the lowest-paying industries.

The only positive was that wage growth, where average hourly earnings were up 0.5% in January and 2.2% YOY, beating expectations.

Contrarian Report Jason

Hamlin

DOWNSIDE PROTECTIONWe booked profits in our hedge, the ProShares UltraShort S&P500 ETF (SDS), during January. Markets are tumbling again and for our next hedge, I will likely short a bank stock with concentrated exposure to oil loans. Texas Capital Bancshares (TCBI) is high on my target list, along with BOKF.

February 2016

PROTECTING WEALTH & MAXIMIZING RETURNS IN HARD ASSETS

Page 2

Manufacturing, once the cornerstone of the US economy, has fallen sharplyover the past decade as corporations seek lower-cost labor overseas. The ISM manufacturing index, which gauges factory activity, has contractedfor four straight months as employment in this sector has slumped to a 7-year low! The index remains well above the 2008 low of 33, but the trend is not encouraging.

JP MORGAN

"Use any bounces

as selling

opportunities"

January 2016

The economy expanded at an annual rate of just 0.7 percent in the fourth quarter of 2015. The slowdown is being driven by anemic sales of durable goods,a weaker trade picture caused by the stronger dollar, falling business investment and shrinking inventories.

The ISM manufacturing index remains in contractionary territory at 48.2 and the January Dallas Fed mfg activity index fell to -34.6. Durable goods also fell -5.1% vs expectations of -0.7%

The non-manufacturing index fell more than expected, dropping from 55.8 in December to 53.5 in January. U.S. Factory orders have dropped for 14 months in a row.

There is no shortage of bearish economic indicators suggesting plenty of downside ahead. But the big problem is that the two major growth sectors, domestic energy and the service sector, areno longer growing.

The Chinese economy is one of the main causes of global economic slowdown. It grew at a reasonable 6.9% last year, according to officials. However, this was the slowest growth rate in nearly 25 years and the Shanghai Composite index is down roughly 50% from the June peak. The Chinese PMI slipped to 49.4 during January, dropping deeper into economic contraction. The Institute of International Finance has revised its estimate of capital flight from China in 2015 to $676 billion.

In the United States, Housing starts unexpectedly declined in December, down 2.5% to an 1149k annual rate. New home sales spiked and home prices are still climbing, but the pace has slowed considerably.

We now have slowing growth in China, an energy sector getting hit hard by multi-year lows in prices, the commodities-slump crushing GDP in nations like Canada and Australia, the service sector in the United States contracting and housing activity staring to slow. These areas led the recovery since 2009, so it is particularly troubling to see these remaining bright spots losing their shine.

Not surprisingly, the world's biggest steelmaker lost nearly $8 billion in 2015 and corporations from Walmart to Yahoo to GoPro are cutting jobs aggressively at the start of 2016.

Page 3

Stock Technicals Remain Bearish

On the long-term chart, we can see that stocks still have much lower to drop before matching historical corrections. At minimum,I expect a decline to the 50% retracement level of 1400. However, I think we could see a 50% decline from the high point for the S&P 500, which would suggest a bottom around 1050.

I don't often agree with JP Morgan, but in this case I think they are correct to suggest that any bounces in 2016 are selling opportunities.

The technical chart shows a brief drop below thesupport trend line during January. However, it bounced back above this important trend line this past week and remains just above it today.

This still marked a lower low and is bearish indicator for the equity markets. I will be watching the 1880 level closely to see if the index can hold above this support line.

The RSI momentum indicator is pointed lower and has room to drop before becoming oversold. It would have to drop all the way to 15 to become as oversold as it was in August.

The rally in equities that occurred during the last week of January appears to have been a dead cat bounce. After falling to 1814 on January20th, the S&P 500 rallied all the way to 1950. But it was turned away at that level and dropped back to 1880 in the past few days.

We can't rule out the possibility or another rally with central banks pulling the levers behind the curtains. But I think we are more likely to see a continuation of the decline and new lows in the coming weeks.

They (the FED) have got to dial this [hawkish] rhetoricback or the markets are going to humiliate them.

- DoubleLine's bond guru Jefrey Gundlach

Page 4

Baltic Dry Index (BDI) Dropsto Another New All-Time Low

Last month we reported that the Baltic Dry Index crashed tothe lowest level ever recorded (429), 30% lower than the previous record low from 1986.

This month the BDI dropped another 30% to a new low of just 297! This suggests that global economic trade is grinding to a standstill. Demand for shipping raw materials has fallen so rapidly that prices to ship have plummeted.

As the baltic dry index continues to plumb new recordlows, how long until central banks realize that for all their omnipotence and all their attempts to restore growth, inflation and the "wealth effect" they never mastered the only thing worth printing in a globalized world:printing trade?

- ZeroHedge

It is no surprise that world trade volume mirrors the BDI. This chart to the left confirms the thesis that lower shipping prices are a result of slowing global trade. While there was a small bump in late 2013/early 2014, global trade never really rebounded in the same way that equity market did following the 2008/09 financial crisis.

In fact, most economic indicators have failed to bounce back to their previous healthy highs, which is one of the main reasons that we have been calling into question the sustainability of the 'recovery' in the stock market.

The Baltic Dry Index is compiled by the London-based Baltic Exchange and covers prices for transported cargo such as coal, grain and iron ore.

The index is based on a daily survey of agents all over the world.

It is an important indicator of the overall health of the global economy and is often viewed asan unbiased data point free from government influence.

Page 5

After a short rally and consolidation to end 2015, the price of crude oil plummeted at the start of 2016 by more than 20%. This plunge took the price to around $27.50 before a v-shaped recovery brought it back towards $35. However, it has been sliding once again and looks set to test support at $30 this week. Last month I stated that: I think we are likely to see a dip below $30 before oil finally bottoms.

The technical chart shows the sharp sell offin January and snappy rebound. So far, oil has put in two higher lows (see dotted trendline), which could suggest a bottom and new uptrend being established. I will be watching this line closely in the coming days to see if support holds.

However, I think global deflationary pressures could push the price of crude back below $30 and towards $25 before it finally bottoms. I expect a sharp bounce as speculators pile into the trade seeking returns in an environment where there are very few undervalued assets.

Food Prices Fall to New Low in January

Food continued lower during the past month. The FAO Food Price Index averaged 150.4 points in January 2016, down almost 3 points (1.9 percent) from December and as much as 29 points (16 percent) below January 2015. The prices of all the commodities tracked by the Index fell, with sugar and dairy products registering the steepest declines.

I have been surprised by the sharp decline in food prices over the past five years. With a growing population, increasingly scarce water and arable farmland, one would think food prices would be rocketing higher. But global deflationary forces have impacted all prices of all commodities across the board. I think this will turn at some point in the next few years, but for now the trend is lower.

Oil Prices Plunge 20% to $27.50Before Bouncing Back Above $30

Page 6

Gold Blasts 11% Higher in one ofthe Best Ever Starts to the YearThe odds that precious metals have bottomed are now > 50% as gold breaks through key resistance and marks a new higher high.

Gold is up $115, a massive 10.7% gain sofar in 2016. The chart shows that the price has broken through resistance at both the 100-day and 200-day moving averages.

However, it is getting close to major resistance in the $1,180 to $1,200 range and the RSI has become overbought. Thissuggests that we could see a pullback in the short-term, likely towards support around $1,130.

If we analyze the long-term chart going back to the financial crisis, we can see a rough pattern in the advances and pullbacks. In late 2007, gold went up by $550, then corrected by $275 or half of the advance. During the next leg, gold advanced by $1,200 (roughly double the previous advance) and then declined by $800 (2/3 of the advance).

Given that the current correction has lasted longer and been more severe than previous ones, I also expect the next upleg to last longer and be more powerful. At minimum,I forecast an advance equal to the last one, representing a move to the $2,300 to $2,400level.

Going forward, we need to see gold break above key resistance at $1,191, which is also the long-term trend line resistance. While the recent move is very bullish, the downtrend remains intact for now. Within the next 12-18 months, I expect that the gold price will make new highs above $2,000 per ounce. This may seem hard to imagine in the current environment, but long-time gold bugs are well aware of how powerful the upside moves can be when this bull gets kicking full stream.

On the high end of my forecast, I think gold could advance by double the prior advance ($2,400). This would equate to a gold price in the $3,400 to $3,600 range. This would probably be accompanied by a loss of faith in fiat money, but our true wealth will grow.

'Gold' was one of the top 5 searched terms on Twitter last week

Page 7

Silver Climbs 8.5% YTD to $15,Underperforming GoldSilver is coming along for the party, but not outpacing gold as it usually does. I attribute this underperformance to silver having a much higher percentage of demand from industrial sources with slowing growth. Exploding investment demand might make up the difference, but silver may lag gold in the early stages of the upleg. I think it makes sense to have a mix of both gold and silver.

The silver chart shows the recent breakout through the 100-day moving average and above $15.

The silver price has climbed towardsthe downward-sloping resistance line, near the 200-day moving average. Silver could run out of stream this week as it nears this line and the RSI reaches towards overbought levels. The dotted line could be the start of a new uptrend, but silver still needs to clear $15.15.

The world's largest silver producer, Mexico, has seen declining silver production for a few years now. Production peaked in 2013 at 5,821 metric tons (mt), fell to 5,765 mt in 2014 and is estimated to decline to 5,634 mt in 2015. A large portion of the annual mined silver comes as a byproduct from mining other metals such as zinc, lead, nickel, etc. With global manufacturing slowing, demand for industrial metals slowing and prices near the cost of production, miners are being forced to shut down unprofitable mines at a quickening pace. This is leading to less silver supply in the market and will ultimately be supportive of silver prices going forward.

I updated my gold seasonality chart through the end of 2015. It shows thatthe biggest gains come in January andFebruary of each year. Gold then tends to consolidate or correct over the Spring months, fall in June and then ramp back up throughout the Falland into the Winter season. I don't puttoo much emphasis on the predictability of this chart due to widevariance and extreme outliers. Nevertheless, it suggests another strong month for gold in February.

Page 8

Last month I pointed out the double top in the USD index, suggesting it was a bearish indicator. Indeed, the USD turned lower after hitting this resistance. But it then attempted another rally over the past week and was once again turned away near 100. So, we now have a triple top pattern at strong resistance.

After failing to eclipse 100, the USD has now dropped below 97 with room to continue lower. I expect it will find support around the93-94 level once again, which may coincide with a pullback in gold.

If FED backtracks from rate hikes, gold miners can go up 50%.

– CNBC Feb 4th, 2016

Revised FED Rate Hike ExpectationsPart of the reason for the recent dollar weakness and gold strengthin revised expectations on the aggressiveness and pace of FED ratehikes. With stocks having one of their worst starts ever to a year,the odds of the FED hiking rates again in March have droppedsubstantially. If the weakness in equities continues, some evenbelieve the FED will have to backtrack, reduce rates or introducenew stimulus to prevent a full fledged depression from unfolding.

We have been forecasting this trend for quite some time and believe it will continue to be a supportive factor for gold prices throughout 2016. Much of gold's weakness in the past year has come from expectations of the FED raising interest rates and pushing the US dollar higher. Now thatthe first rate hike is behind us, I think the shadow hanging over the gold market is gone. I now believe that gold is likely to continue higher, even if the FED is able to continue increasing rates. Indeed, there is historic precedence of the gold price to moving higher along with a gradual pace of interest rate hikes. Gold performs well during rate hike cycles, as it did from 1962 to 1981.

I believe we could be seeing the beginning stages of the next major bull market in precious metals.

USD Fails to Break Above 100Level Again, Turns Lower

Page 9

Gold Stock Bull Portfolio

Cash: We added SWN and SA during the past month, but still have a hefty cash position. I will likely add to our gold/silver positions this month, further depleting our cash position as precious metals charge higher.

CEF: The Central Fund of Canada is trading at a 5.8%, after having a 10% discount to its net asset value (NAV), last month. Shares are up 15% year-to-date in 2016. Status: Long-term buy, short-term wait for a dip as gold prices have become overbought and are likely to pull back a bit.

SAND: Sandstorm Gold is down 2.8% year-to-date, underperforming by a wide margin. Shares are up 12% inthe past week. I still like SAND, but it will need start performing for us to continue holding. They bought a package of 56 royalties from Teck Resources for around $20M during January. The market did not seem to like the deal, which is hard to value. But I think it will prove accretive to shareholders. Status: Hold

FNV: Franco Nevada is up 9.4% year-to-date and 13% in the past week alone. Full year results will be released on March 10, after the market close. Status: Hold

RGLD: Royal Gold is up 7.5% YTD, but advanced 32% in the past week alone. I have been anticipating a strong rebound to their earnings and they delivered this month. RGLD had record revenue of $98.1 million, up60% and net income attributable to Royal Gold stockholders of $15.1 million, or $0.23 per share, compared toa loss of $6.5 million, or ($0.10) per share, for the prior year quarter. Status: Hold

AXU: Alexco Resources is up 35% YTD and 21% in the past week. I remain bullish and think the stock will explode higher as silver prices climb back towards $20 and they are able to restart production. Status: Hold

PVG: Pretium Resources has bounced 16% in the past week, but is still down 1% YTD. During January, reported assays include seven intersections grading greater than 1,000 grams per tonne gold. Commercial production is targeted for 2017 at their high-grade/low cost project. Status: Hold

AMI: AuRico Metals is up 8% YTD. Permitting at Kemess has progressed and the feasibility study is expected in March. Their high quality royalty on Young-Davidson seems undervalued and I think they could be a takeover target. They expect to be cash-flow positive in 2017. Status: Hold

Disclaimer: The model portfolio is a list of stock selection ideas, not recommendations. Each investor should do his/her own research to ascertain whether a particular stock selection meets their own investment criteria before buying or selling.

We are not registered investment advisers andcan not provide specific investment advice. Premium members will receive an email update whenever there is a change to the portfolio.

Page 10

HTM: US Geothermal is down 2.4% YTD. The company advanced 36% last year and I expect another double-digit return in 2016. Status: Buy on dips below $0.60.

SWHC: Smith & Wesson is down 2.6% YTD, after climbing 122% during 2015. I don't expect another doubling of the share price, but believe it will continue higher in 2016. Status: Buy any dip under $20.

INP/INPCF: Input Capital is down 1% YTD. F2016 Q3 results will be released on February 16, 2016 and give us a better flavor for their financial growth. Shares seem cheap here and I continue to like their business model. I believe agriculture prices will bottom in 2016 and begin moving higher, so Input Capital is poised to generate significant returns into the future. Status: Buy the dip with a long-term view.

TURV: Two Rivers Water & Farming is down 9% YTD. I believe we will start to see strong cash flows in 2016 and their business model has extremely high margins. The company has an aggressive growth plan and has already started construction of their second greenhouse in Colorado. Status: Buy

SWN: Southwestern Energy is up 36% in the past month and 31% YTD. We added shares expecting a rebound in natural gas prices. I also believe the company is undervalued at current prices. Status: Hold.

SA: Seabridge Gold has rocketed 20% higher in the past week, but is still down 10% YTD. They have one of the largest undeveloped gold projects in the world and have a very low valuation of around $7 per ounce of gold in the ground. Although grades are not as high as I usually like, the pre-tax NPV(5%) on KSM is roughly9X their current market cap. Status: Long-term buy, but short-term wait for a dip towards $6.00.

Summary: It has been an incredible start to the year for precious metals investors. Mining stocks are outperforming gold by 2.5X, offering the leverage we have been expecting. However, the larger mining stockstend to move first and then the junior resource stocks follow and outpace the big caps. This is what is happening so far in 2016, with the GDX up nearly twice as much as the GDXJ. But as gold continues higher, watch for the juniors to roar to life. I believe the gains are going to be exponential.

While I am very excited about the prospects for precious metals and mining stocks in 2016, I do want to issue a word of caution in the short-term. Gold is up against significant resistance at current levels and the RSI has become overbought. I think we are likely to see one more pull-back in the short-term before gold finally breakout of the technical downtrend and moves towards $1,500 per ounce.

And while the odds that we have seen the bottom have increased significantly in the past month, I still assign odds of 30-40% that gold could have one more drop to test $1,000 before the true bottom is found. So, I think it makes sense to be cautiously optimistic at this juncture, but retain a diversified portfolio with a good amountof cash (20%+) on hand.

Energy prices probably have one more leg down, with oil falling into the $20 - $25 range. That being said, I still expect prices to bottom in 2016 and begin moving sharply higher at some point. With so investors taking a position one way or another, I expect high volatility in the oil price throughout the year.

Likewise, I think our agriculture will bottom and move higher this year or early in 2017. But all commodities are susceptible to another major leg down if the economy slips into a Depression and the stock market correctsseverely as I believe it could.

No matter how things play out, we will continually adjust our positions and look to maximize returns in 2016. It has already been a great start to the year and I expect this trend to continue. The portfolio, trade history Gold Stock Bull Premium Member page.

Page 11

Gold Stock Bull Watch List

Gold Stock Bull is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities customers should buy or sell for themselves. Jason Hamlin is not an investment advisor. All ideas, opinions, and/or forecasts, expressed or implied herein, are for informational purposes only and should not be construed as a recommendation to invest, trade, and/or speculate in the markets. Any investments, trades, and/or speculations made in light of the ideas, opinions, and/or forecasts, expressed or implied herein, are committed at your own risk. The information on this site has been prepared without regard to any particular investor’s objectives, financial situation, and needs. Accordingly, investors should not act on any information on this site without obtaining specific advice from their financial advisor. Past performance is no guarantee of future results. Click here to view our full Terms of Service and Privacy Policy. Copyright © 2016 Gold Stock Bull - All Rights Reserved

Precious Metals

Other Sectors (Dividend, Energy, Agriculture, Water, Technology)

Kirkland Lake Gold (TSE: KGI or KGILF) Endeavour Mining (TSE: EDV or EDVMF) Belo Sun Mining (TSE: BSX) RoxGold (CVE: ROG or ROGFF) Richmont Mines (NYSEMKT: RIC) Vista Gold (NYSEMKT: VGZ)Sabina Gold and Silver (TSE: SBB) New Gold (NYSEMKT: NGD)Guyana Goldfields (TSE: GUY / GUYFF) Asanko Gold (NYSEMKT: AKG)GoldMoney Inc. (CVE: XAU) Yamana Gold (NYSE: AUY)Banro Corporation (NYSEMKT: BAA) Red Eagle Mining (CVE:RD or RDEMF)Altius Minerals (TSE: ALS or ATUSF) First Mining Finance (TSE: FF or FFMGF)Integra Gold (CVE: ICG or ICGQF) Great Panther Silver (NYSE: GPL)Claude Resources (TSE: CRJ or CLGRF) Avnel Gold Mining (TSE: AVK or AVNZF)

Northern Tier Energy (NYSE: NTI) Consolidated Water (NASDAQ: CWCO)Potash Corp (NYSE: POT) Crown Castle Int (NYSE: CCI)MCW Energy (CVE: MCW or MCWEF) Omega Healthcare (NYSE: OHI)Energous Corp (NASDAQ: WATT) GW Pharma (NASDAQ: GWPH)Second Sight (NASDAQ: EYES) Clearfield Inc (NYSE: CLFD)Farmland Partners (NYSE: FPI)

Top Performers YTD 2016: KGI +25%, RIC +28%, GUY +38%, CRJ +26%, NGD +25%, AUY +23%

Recent Insider Buying: Asanko Gold, B2Gold, Sandspring Resources

New Additions This Month: Avnel Gold Mining, Farmland Partners Avnel's Kalana gold project is one of the most economic (IRR 70% at $1,200) in the mining sector and they should begin construction by the end of 2016. Farmland Partners is an agriculture REIT with a strong buy rating and 5% dividend yield at current prices.

The GSB Watch List contains companies that I believe have the potential for rapid price appreciation over the next 12 to 24 months. As these companies make progress or come out with news, they may get added to the GSB model portfolio.