Saturday, March 10, 2012
Interviewed at the McEwen booth, except this time McEwen Himself isn't hogging the entire shot. And there's a nice big castle of shiny silver bars in a few of the shots.
Both Brent and Mickey are very pessimistic about the exploreco sector this year. Horribly pessimistic. Lines like "most of these companies don't even have gold!"
Though I have to admit that using your advance money to buy a tank is a very, very good idea. Then, driving your tank to BBC Radio to drop off your new single is an even better idea. And installing a sound system in your tank so that your tank can be an unbustable moving rave is certainly up there with the discovery of the law of gravity.
And I've made a mental note to myself that Scotsmen are actually easy to understand, as long as you're drunk when you listen to them.
Here are some stills from the movie, and yes, they all seem to involve Bilinda Butcher. Because this is my blog and I do whatever the fuck I want. I especially like the first one, showing MBV charting above Nirvana, because Nirvana always did suck compared to MBV. Teenage Fanclub also utterly sucked, never saw the point to them.
Good movie to see, if you happen to have been me all your life.
And the mystery is solved. Creation went bankrupt not because of the half million dollars and fourteen months MBV spent making their last record in a dozen studios with 25 different engineers and producers, but rather because Alan McGee was spending even moar money than that on drugs.
50% of gold demand is in jewelry, and half of that goes to India. Or something. So India is a significant driver of the gold price - a terribly outsized effect on the marginal end. Overzealous tightening in India in H2 2011 temporarily killed the rupee, making gold more expensive in this high-consuming nation.
Oh... and the price of a gold miner should depend on expectations of future demand for gold. No?
Now, here's a technical analysis for you:
Gold's loss of upward momentum began right after the rupee lost trend and took a faceplant in the fall. (I know this is a money market fund, but I'd expect its performance should somehow reflect something-or-other internal to India.)
Now here's the daily:
Now I would like to make a couple points.
1. THERE SEEMS TO BE A CORRELATION AND I WISH SOMEONE ELSE WOULD PICK UP ON THE IDEA SO I COULD STOP WORRYING THAT I'M IMAGINING THINGS.
Cos honestly, you don't want me to be the guy that makes the discovery that he's right and everybody else is wrong. You really really really really don't want that.
Now, I know that nobody in America would even consider the possibility that gold price is dependent on rupee-denominated demand. After all, that means they'd have to shut the fuck up about money-printing, and Ben Bernanke, and the secret Kenyan Islamity of Barack "Hussein" Obama, and oh that Mittens Romney will fix everything by eliminating taxes and increasing defense spending (seriously, what. the. fuck?).
But it would be really nice if someone, somewhere, anywhere, could repost this chart and... you know, do what the technical analysts do - draw a few lines and stuff - and announce to the world "egad, it must be true! The price of gold seems to correlate well with demand denomination in rupees! Why, let's follow the Indian economy and currency more closely, and see if this will provide us with some predictions for future movements in the price of gold! I say, old chaps! Let's ignore this American propaganda about inflation and the gold standard and JP Morgan, and just look at the rupee! What a jolly good idea!"
2. That correlation seems to have gotten broken a bit on the day last week that gold collapsed by $100. Meaning, I've got a suspicion that gold should have a bias right now towards snuggling back up to the rupee.
Could be wrong. Remaining agnostic for now. Let's wait and see.
But still, come on. Come on, really?
You trying to tell me that everyone in the anal yst movement is yattering on about gold, and yet not one of them has ever read the World Gold Council's supply/demand report, then decided "hey let's go to Stockcharts.com and chart gold versus rupee just for a larf", and then looked at the charts above, felt that all-too-rare "thunk" in the braincase, and exclaimed:
Al seems to be an uncontrollably nice fellow; Roger seems to be an actual trader. Put the two of them together, and while I think their fundamental narrative is incontrovertibly wrong (see below), the way most are in the US investment scene, they do seem to come out with opinions that I value highly. Maybe just cos Roger seems to be a real trader, and that gives me a valuable perspective.
So, go listen to their two Friday editorials on Kereport.com.
1) they've (or at least Al seems to have) been suckered into believing the Republican disinformation about jobs. Sorry guys, but US employment is improving. It is what it is.
2) forget about Greece. And btw, the Greek plan isn't debt-destructive; the exchange involves the printing of new money in the form of Euro debt that's being handed over in addition to the new Greek bonds. You could also note that since the Greeks are replacing Greek-law with English-law, the new debt is more "real" and less "imaginary" than the old Greek debt. But they'll default again and again because it's Greece and it's a nation of swarthy tax-evaders. It means nothing, please ignore it.
With that in mind, what's important to me is they also are noticing the strong action in gold on Friday, after the LME smackdown.
I like when I find I didn't just hallucinate something.
IKN posted this chart, as usual each week:
The interesting part for me is Friday:
The Evil Empire of Lizard-People, with their Satanic henchmen at JP Morgan, laid a good hard smackdown on gold and silver at the Friday pre-open (well... at the LME, I guess).
Silver and gold then stumbled further during the NYSE open (cough retail chickenshit hour cough). But they recovered, and quickly drew something fairly close to a V-bottom (which to me is always incredibly bullish).
They then spent the rest of the day drifting mildly higher, back in-trend with the upward drift of previous days, which (after the V-bottom) also seems bullish to me - it really seems to negate the prior smackdown. Hey, even the Tuesday smackdown has been negated now.
(I'm only looking at this from an amateur mass-psychologist's perspective - I dunno if any of this stuff is covered in TA books.)
And yet? And yet?
The miners drifted lower after noon.
Now, I'm a guy who does love watching the L2 minute after minute. And I've been doing that for over a year now. So I've developed a theory that Friday afternoon is when the institutions all leave the market, and the miners' world becomes a great big sandbox dedicated entirely to us stupid little retail kiddies. Volume dies, bids & asks thin out. Certainly the professional and ex-professional people I follow all seem to spend their Friday afternoons sipping lattes at the Starbucks, instead of watching & posting about the market.
So that means Friday afternoon's drift lower in the miners was retail-driven. Maybe retail is still trying to puke their stocks in anticipation of the PDAC curse?
Now, are retail the smart guys?
I'm trying to be really agnostic here. I could also talk to you about the fantastic number of head-and-shoulders patterns that this week's "bear flag" is starting to paint - look at SIL, FVI, DPM, and so on. The right shoulders aren't painted yet, but that is something I'm watching out for - if we don't get a break above EMA(8)s next week I might just unload everything, go to cash, and accept that Gary T was right all along.
Cos if that right shoulder rolls over, you're looking at (for example) $5.25 for a target for FVI. And I don't want to be in that market. That's a fucking stupid market. And when people get that stupid, I get scarce. (Unfortunately, I suspect you can't safely go short stupid.)
But damn, I saw all that moping coming from all the analysts at PDAC, under the guise of "gold and silver miners are terribly undervalued". It sounded like people who are very unsure of themselves, feeling presently insecure in their life's calling (what, you think these guys could ever switch to covering the consumer discretionary sector?), trying to convince themselves that things can only get better from here. "They should! I mean, gold and silver miners are undervalued! ...um... aren't they?"
And if the analysts are saying that, then their readers are saying that too. And everyone's eyes are searching for a glimpse of the bright future - while their hands are twitching over the sell button.
Contrarians like GT are the other way around - his eyes are searching for yet more signs of an imminent collapse, while his hands are twitching on the buy button.
And I bet when everyone goes to bed at night, they're all sleeping in a great puddle of sweat, mumbling "Euro collapse... December... China slowdown".
That's why I yelled "oh! oh! I call bullshit on that!" during the big pre-PDAC swoon.
Europe is fixed... well, it's as fixed as it'll ever be. This is Europe, remember. Go read the Reformed Borker, put him on your RSS, read him religiously every day. He was one of the first to wake up out of the mass hysteria, look around at the stupidity all around him, and say: "Wait a second... blah blah Greece blah blah? Are you fucking serious? I fell for that?!?"
December was a tax loss mania after major collapses in all sorts of stocks. It's not just the suck of the major miners like K, NEM and AEM; all the explorecos north of 60 collapsed. So I look at December's $22.50 GDXJ and I keep in mind that we need to see major dumpage of the miners, driven by something equal in power to tax-loss season plus fear of imminent Eurozone collapse plus even moar people realizing the majors will never be able to mine gold at a profit, before we can evarr print a number that low again.
Can we get back to 480 $HUI? Well, that's different: major gold miners suck. But Yamana looks strong, Goldcorp's improving, Coeur D'Alene is fine. I think the sucky miners have to suck even worse, so bad that they drag down the good miners, before we can get to 480 $HUI.
And yeah, that all depends on gold and silver maintaining strength. And yeah, Turd Ferguson has now convinced me that the 1-month silver lease rate means something, and yeah, it's not moving up fast enough yet, so yeah, we could get much further dumpage in the PMs, and yeah, that might the thing we're looking for that can drive the miners down below 480 $HUI and $22.50 GDXJ.
So my eyes are watching SLV and GLD and my hands are twitching over the sell buttons.
But some folks have said last week's gold swoon was either a fat finger, or a Satanic Zionist Banker Conspiracy to destroy the PMs (that strangely coincided with PDAC btw). And other folks have asserted that silver and gold now have strong physical buyer support at these lower prices - meaning the playtime bullshit is at an end: you ain't fighting with paper no more, fucker, now you're duking it out with real metal.
I.e. if they puke metal again, this time they're going to see it all disappear to a vault in Bangalore.
And GLD holdings have surged to an all-time high. And everyone's still bullish gold.
So that suggests to me that further PM drops have already been very heavily sandbagged against.
Now Gary T has noted that the carnage has cleaned up the PM COT.
So. Put all that together, and tell me what can possibly go wrong?
Friday, March 9, 2012
But I've failed to include any Jeff Berwick.
It's not because I don't find the guy likeable or anything, it's just that honestly I've gone digging and haven't found him on BNN, or being interviewed on Kitco TV, or anywhere.
As it turns out, though, I have now found a video of him, speaking in San Diego last fall.
I truly, strongly, earnestly, whole-heartedly suggest that you watch it in its entirety. All 47 minutes of it. Because you should not be allowed to go through life without having listened to Jeff Berwick.
Really, honestly, truly. The only people who should get a free pass in this are guys like me who already spent years debating Libertopians on talk.politics.libertarian and have thus already gained an intimate understanding of Ayn Rand, Ludwig von Mises, Chicago School Economics, Ragnar Redbeard, and Max Stirner.
So, here it is again. Watch it.
Dude, I don't care. I'm going to keep putting it in front of you til you watch it.
Sigh... okay, if you're one of those lazy property-confiscating socialist cockroach types who can't be arsed to get up off their butt just to watch a good 47 minute libertarian talk, then at least watch this, an 8-minute pre-PDAC interview by (wait for it... wait for it... wait for it...) Daniela Cambone (there we go!) that gives you an entirely insufficient and disappointingly superficial introduction to the mind of Jeff Berwick.
Please, just watch it. You really need to listen to this guy.
Sounds like a good time to short gold, eh?*
*this blog may, at times, contain sarcasm. I refuse to provide fair warning. Except maybe just this once since there are so many new readers.
ATHENS (Reuters) - Greece averted the immediate threat of an uncontrolled default on Friday, beating strong acceptance into its private creditors for a bond swap deal which will eat into its mountainous public debt and clear the way for issuance of an even larger amount of debt.
With euro zone ministers set to approve the 130 billion euro ($172 billion) rescue, French President Nicolas Sarkozy declared the Greek problem had been settled - just as Germany said that any impression the crisis was over "would be a big mistake".
Markets sharply marked down the value of new Greek bonds to be issued to the creditors, reflecting the expectation of paralysis after elections expected this spring and the certainty that Athens has no interest in bringing its debt to a more manageable level by 2020.
Sarkozy, who is trailing his socialist challenger for the presidency before France's own elections in April and May, pronounced the Greek deal a major success.
"Today the problem is solved," he said in the southern French city of Nice. "A page in the financial crisis is turning."
Euro zone finance ministers held a teleconference call and were expected to declare Athens had met the tough terms of the bailout, its second since 2010, and to authorize the release of funds which the country urgently needs to embezzle into the ruling class' Swiss bank accounts.
On the streets of Athens, some Greeks denounced the deal as a sham that would impose more crippling austerity on a people already finding it hard to steal everything that's not nailed down.
German Finance Minister Wolfgang Schaeuble was also in a more somber mood than Sarkozy, issuing a warning to Athens which has a record of having their joking promises of reform and austerity taken seriously by international lenders.
"Greece has today got a clear opportunity to recover. But the precondition is that Greece uses this opportunity," he told a news conference. "It would be a big mistake to give the impression that the crisis has been resolved. They have an opportunity to solve it and they must use it."
"Holy fuck", Schaeuble added. "Did that really just come out of my mouth?"
(and so on....)
Turns out he posts even more media than me. Even moar.
So, stealing from him entirely, here's Mickey! Mickey! Mickey! getting interviewed on BNN during PDAC.
Mickey on BNN - again, talking about graphite.
And here's Rick Rule on Tuesday's Market Call:
part 1 - part 2 - part 3 - part 4
GLD is painting a bullish outside day, and is coming up against the EMA(8). Too bad it's Friday... but it seems the rest of the day is going to be hideously important.
Oh look. Bullish outside day forming in silver too. Testing EMA(8). Y'know, I think this is some sort of chart analysis I'm doing.
And all this happens despite a strengthened US Dollar. Hm. That's weird.
Now, sure, the latter isn't chart analysis. The latter is me impressed at how my "I call bullshit on that" position seems to be strongly confirmed today by the gold and silver action.
I could still end up hideously, gruesomely wrong in my bottom call of earlier this week.
In fact, silver's swooning right back down right now... so I'll shut up.
It's not PDAC, no. But she's interviewing Adrian Day, who I thoroughly enjoyed at PDAC Sunday. I haven't even watched it yet, but it appears he's going to talk about China, and I found what he said on that topic to be very very enlightening - one of my most useful takeaways from that day. So, in all seriousness, do close your eyes and listen to Adrian Day.
And, again, Daniela Cambone, this time back at PDAC, speaking with Lord Sir Robert McEwen, 24th-level Archmage and Minor Godling, about (you guessed it) how gold is going to da moon Alice. And you should buy his stocks.
First impression? I don't like him. He doesn't let Daniela share the shot with him. Little things like that say a lot.
And, just for Otto and his many LatAm followers, here's a video that doesn't have Daniela (aw...) but does have some guy at PDAC talking in Spanish about something.
Maybe he can repost it over at his blog and explain to us gringos what the heck they're all talking about.
And Mickey says "graphite!"
Only 4 views til I came along. Let's try to boost it to 12, guys!
Frank Holmes points out last week's goldpuke was a "fat finger" trade - or, as I personally call it, a brazen orchestrated effort by JP Morgan and the Joos to try to sabotage the precious metals complex in order to further their evil Zionist agenda.
Well... not really. But... yeah, sort of.
So sez Bloomberg, yesterday. I.e. before this morning's LME puke, which just happened, oh my.
So, either bet against the herd, or realize that there's sometimes a reason to be bullish.
I wonder what's going to happen with all my new longs in miners today....
Green Grass of Tunnel:
We Have a Map of the Piano:
Now There's That Fear Again:
Thursday, March 8, 2012
There's more new Kitco interviews at YouTube. I'll maybe link to some others after the obligatory wailing and gnashing of teeth over this morning's PM puke.
London Trader - Massive Physical Silver Orders Filled Near $33 - fap fap fap....
London Trader - 40+ Tons of Physical Gold Acquired Yesterday - fap! fap! fap! fap! fap!
RSI(8) seems to give you buy signals, at least. Standard MACD? Meh, sorta okay, I guess. A bit late, though - maybe if I ever felt like it ever in the rest of my life I'd bother to tune it to the right numbers (20 and 2 don't work that well since as I said it's late). And my magical EMAs are utterly frickin' brilliant.
But where the heck do you get any sort of signal from $BPGDM?
If you look at the past week, $BPGDM was bullish all through the PDAC swandive. Since then? The past few days? It's all of a sudden slightly bearish.
It's as if all the goldbugs out there have been scared out of the market by a bunch of talk about "bear flags" and "the PDAC curse takes more than 3 days to happen" and... and... and so on.
So now it's like an empty room - the GDX, GDXJ, and SIL. No volume. You can hear crickets. Nobody wants to play there. Volume is zero.
I just find that interesting.
Hey, maybe $HUI'll collapse to 450. Or 300. Fine. Could happen. This week? I dunno. But if you think so, tell me - why hold any gold miner stocks at all? Even good ones?
The CEOs of Goldcorp, Yo-mama Gold, and I!Am!Gold! sat down for a half-hour roundtable. They get into things like spiralling cash costs, as well as a more charitable explanation of the difference between "cash costs" and "all-in cash costs" (also known as "uh... the real cash costs, buried in a line item on Page 126 and never once referred to in a news release").
But seriously though.
Another nice thing they point out is they're not going to bother acquiring any properties with political risk. Why bother, they say. Screw it.
I!Am!Gold!'s CEO also notes his company's stock price is going for a song right now. So buy some IMG. Um... after it stops plummeting and the bad news gets out, whatever it is, of course.
Tune in and watch!
part 1 - part 2 - part 3
He says they'll look at Peru and Mexico.
They want a nice big low-cost silver deposit.
With about half of that new output coming from expansions at its existing projects in Mexico and Peru, Fortuna is taking a hard look at other growth opportunities.
"It will likely come from an acquisition," said Ganoza. "Now will it be a post-discovery, pre-development stage opportunity? Very likely, that's where we look."
To that point, Fortuna is eyeing targets throughout Latin America. Peru and Mexico are its preferred regions, but Argentina, Chile and Central America are also on its radar.
The main criteria is a silver deposit with a big enough resource to operate for many years and is similar to mines the company already has in its portfolio.
"Every time we think about bringing something new into the portfolio, we don't just look at the quality of the asset, we say 'how does this impact the portfolio'," said Ganoza.
"Not all ounces are created equal, we want ounces that provide that healthy margin that our operation needs."
Bear Creek has a nice big post-discovery, pre-production silver deposit. In Peru, even. Why don't they just buy Bear Creek? It's pretty cheap right now.
$HUI hasn't even made it back to its EMA(8) yet, nor GDXJ nor SIL. So it's too early to say. Geez, it's still retail hour! And as Mr. Frisby would note, it's dumb to try to pick absolute bottoms - wait til you've broken above EMAs before buying in.
Even (I think) Sperandeo says it's good enough to just get the middle 60% off an upmove. Let the other guys be heroes.
So we'll see. Maybe the Evil Empire decides to give silver one last smackdown? But so far, so good.
One very important little tidbit he pointed out was that last year was a record year for dilu... er... "financings". He notes that "all that paper is coming onto the market very soon", and thus predicts this year is going to be a horrible one for anyone invested in explorecos.
I guess that's yet another good reason to stay away from explorecos. I think I'll stick with producers this year.
Other than that, no comment on Geologix, but someone did still phone in to ask about Golden Hope Mines.
Anyway... you can watch him via these links:
part 1 - part 2 - part 3 - part 4 - part 5 - part 6 - part 7 - part 8
And as a special bonus,
Word comes to me that someone went to the Duke of Westminster on Monday night, saw the Kitco Live filming, and afterwards shot a very special video: Mickey, Brent, and Daniela Herself doing a pretty good cover of Kirlian Camera's 1983 single "Blue Room".
Here it is, straight from YouTube!
EDIT: well, that took all of 15 minutes. I had to take down the video, because I received a note from Kitco's legal team. Boom, just like that. In fact you can't even find it on YouTube anymore.
I dunno why Daniela's so shy about her singing, she's actually pretty good; though Brent and Mickey obviously need practice (Mickey did a great Lol Tolhurst impersonation though).
So, instead I'll replace it with a video of yet another, even greater and more beautiful Italian diva, Elena Fossi, doing "Blue Room" live with the real Kirlian Camera.
Wednesday, March 7, 2012
But I read stuff about "H&S in the semis" and "bear flag blah blah" and I recognize it's written by human beings. And human beings suffer from recency effect. And these particular human beings remember the horrible Chainsaw Rape By Angry Silverbacks that was the gold miners in the fall. And they expect it again.
I said "humbug" to this, for a few reasons:
1) there's no boots-on-the-ground reason for the broad market to drop. Except maybe a disorderly default by Greece. We'll see about that tomorrow, but I suspect the possible holdouts don't want to create carnage in the market.
2) Bespoke (who I'm not unsubscribing from after all, due to today's release) pointed out that on days like yesterday, where the market fell out of a long overbought string, it tends to turn in positive gains for a long while after. And while these various bloggers are human, Bespoke does a great job of acting like an emotionless computer, some sort of hyper-rational Vulcan - they compile data and give you a chart.
I trust machines over humans in situations like this.
Plus, everyone was selling miners cos it's PDAC. And even a retail slob like me now knows about the PDAC curse, right? There's nobody dumber left to sell that story to. I'm it. Even the Agoracom people know by now. Come on - look at the slope of the downfall on the $HUI chart! That wasn't a gentle February descent; that was a crazy December collapse. Why? Why the rush to get out? It seemed overdone.
3) $VIX took a hard down today.
So while I do strongly admire those who I'm compiling information from, I feel I need to pick and choose depending on my own read of the bigger picture. We saw a whipsaw down; there's no reason for a whipsaw down; if you want to buy DUST on a whipsaw down, fine, but remember that it's a whipsaw down. And if you just bought your DUST position on Tuesday, you just bought DUST while $HUI was outside its lower Bollinger band.
That can work out magically when you're certain $HUI is going to 400 in a week. After all, sometimes the signal pops below the lower Boll and stays glued there for a while. But me, the impetuous moron trader, I wouldn't want to buy a short at that location.
I certainly can be proven wrong. Maybe I will. This is just my own private thought process laid out in the open for those of you who find that sort of thing interesting.
Feel free to phone in and ask him why Sabina Silver's price action has sucked so damn bad.
But seriously, I'd really like to hear his take on why everything North of 60 has tanked over the past year. It can't all be because of Newmont and Agnico stinking, since the dive started last fall. What is it then?
Iran's been "on the verge of having a nuclear weapon" since fucking 1980.
File that whole story under noise too, okay?
So, I might be screwing myself, but I'm calling a bottom. Everybody's scared of everything, everyone's expecting last fall all over again without any reason; so you saw a big puke over the past couple days.
But, as I'm saying, boots-on-the-ground-wise, nothing has changed as far as I've heard. China is still what it was last week, Greece was still what it was last week, and the US is still what it was last week, global growth is still what it was last week.
So I'm back in.
11:45AM EST. Mark that on your calendar. Y'know... just in case the market pukes back down to 0 while I'm out buying new clothes.
GDXJ is at a point right now where I'd really think the market has to go all insane and doomy for it to go any lower. This looks like we're at major lateral support, and the RSI(8) is oversold.
SIL looks even better, so maybe it needs to get taken down even farther?
$HUI has a hammer printed with a 502 close. If it goes much lower than 502, that's a bad thing.
FXI is in freefall, with an RSI(8) of 23. I guess turning your back on the magical number 8 has its consequences!
I dunno... maybe this is all much ado about nothing. Chinese growth hasn't magically changed, just the target has. And Greece hasn't changed, just the nerves about its debt refi deadline has.
Going shopping today for clothes, so I'll stay with the cash I have, methinks.
Tuesday, March 6, 2012
1. You get to cheer during market downturns.
2. It gives you something to do while you're loaded with cash.
3. You can make a crapload real quick.
The bad things about playing a leveraged $VIX ETF like HVU:
1. You're stuck to a frickin' monitor all day, watching the intraday of various self-invented "fear gauges" like JNK, SLV, and GDX.
2. You cut your losses on a bad in with a tight stop, and come back half an hour later to see you could have made $2000 if you'd stayed in.
3. You're stuck doing stupid things like hoping retail dumps hard at lunchtime.
I have things to do this week, since I'm off work. So cashing up might be nice. Plus, I want to use some time this week to figure out a proper strategy for investing, and lay the foundation for properly sticking to it.
I fully intend to keep at least some BHV, SWD and AQM in case of newsflow. I will be interested in how well USA holds up, since the company is still buying back its own stock. And I'll wait til RIO is broken before dumping, and maybe check EPU first to see what's going on.
Monday, March 5, 2012
Here's the ETFs that are down today, with strong red candles of one sort or another:
TLT (long bond)
LQD (corp investment grade bonds)
JNK (junk bonds)
SPY and QQQ
GLD and SLV
JJC (copper), JJT (tin) and JJN (nickel)
anything to do with mining
FXI (China 25)
SGG (sugar), COW (livestock), NIB (cocoa)
And the ETFs that are up are....
Haven't read the RSS today. But I betcha I'll be seeing all sorts of wailing and gnashing of teeth over some new macro concern. Probably involving China. Cuz if coffee's the only thing that's up? Eesh.
$HUI and GDXJ are broken, period.
However, I refuse to frown on the silver miners. SIL has so far done no more than go down to its EMA(45), which to me seems like some sort of medium-term support for this advance. And COPX has declined, but only to horizontal support. And now it has an RSI(8) of 31, which looks good.
Argonaut is getting strong buying at the end of the day - as if maybe people think it's a good stock or something?
More broadly speaking,
UUP didn't actually go higher today. Today was a repeat of Friday for the US dollar. JNK doesn't yet seem to have been beaten down any worse than it was in mid-February.
AAPL was beaten down no worse than to its EMA(8), so that doesn't indicate any irrational selling.
I dunno. Things could still get cheaper from here, but while gold miners suck I don't see a knock-on to the silvers. Copper miners seem to be weakening.
But considering this is PDAC week (and every moron by now has heard of the "PDAC curse" and probably wants to get ahead of it), and considering only the $HUI truly stinks right now and it's made up of shitty stocks, I'm not too worried.
Would have to leave right now to get there in time anyway, and that'd mean not reading my IKN & Biiwii newsletters (which I still haven't gotten around to, and that's all you guys' fault).
You guys go without me, okay?
Better question: If GDXJ and $HUI have already broken down, should I really be feeling hopeful for the silver miners ETF? Or am I just clutching at straws?
AR never reaches the EMA(45), seems to use previous highs for support. So, by that token, it's also at a critical juncture.
Both companies make money and are good. So, if they both collapse, that is bad. I will sell and go short miners if that happens. Until they collapse, it's just a mild correction.
But basically, as the good miners go, so go I.
BTW made $500 double-shorting silver this morning. Cut off after it seemed silver didn't want to break $34.
Oh, and apparently there's some sort of scary news about Greece or something or other. Yeah, guys - sell Apple cos of Greece. This kinda stuff just makes me want to go all-long.
DNT insists the arsenic isn't a problem. They're going to build a pre-smelter on site, I think they said $180M, to get the arsenic down to below penalty levels. And then the process produces sulphuric acid, which they can sell at a profit!!!
I tell ya! Go talk to the guy there. (I forget his name - John something?)
He was very witty - took one look at me, with my leather jacket and all-seeing-eye t-shirt, and said "I can't believe it! A retail investor at PDAC?!?" I replied "wow, how can you tell?"
Anyway, moving on:
Here's a shot of Juan Vegarra chatting with a horde of wealthy Chinese investors, just in case you thought I was making it up:
Later they went away, and JV & Enrique spent what seemed like hours talking happily with a guy who seemed to either be wearing an insanely expensive suit (the sort of thing I'd imagine JP Gauthier would design), or an insanely gauche suit (again, Gauthier would fit that too; after all, the guy invented man-skirts). I'm a working-class slob so I'm utterly unable to tell the difference between expensive and gauche. But the suit certainly was impressive.
Here's Brent Cook being mobbed by fans after his chat. The 2 fellows in the foreground are (I think) Vin Maru, and someone from Dollar Vigilante. The Dollar Vigilante guys are indeed very earnest and well-read, in their own field of interest, that's for sure. That the same can be said for Jehovah's Witnesses is all I'm going to add.
And here's a very blurry, poor-quality photo of Jordan Roy-Byrne. My camera simply wouldn't work in the "newsletter writers" room - the zoom makes everything blurry, and the flash made all photos go black. (Sorta like a "create darkness" spell.) I had to finally take the flash off even to get this poor quality photo:
Whoops! That was my lunch, sorry. Hoops Bar, on Bremner Street. Seafood linguine, with squid rings, shrimp and salmon (!). Tasted very nice and fishy, the way seafood should. Salmon was an interesting touch. And it was very very al-olio. Quite nice. Plus Guinness. Whole thing, $30 after tip. Meh... it's Toronto, the condo district, everything's expensive there.
Speaking of which. Some neat things noticed at PDAC. #1, large number of Chinese. Was talking to one guy in the smoking area (from some copper company, no idea), and he's saying that copper is going gangbusters, and the Chinese keep coming over and trying to buy entire companies. He said the buying smells of utter desperation.
#2, large number of latin Americans. Good to see. Maybe someday people will realize that LatAm is where all the Cu/Au/Ag/Pb/Zn is, and they can be the next Canada of mining. I personally would like to see them all get rich.
#3, significant nonzero number of incredibly hot Russian girls. That might just be because we're in the condo district, and... well... who you gonna call?
Yeah... so here's Jojo's photo, blurry as it is. You can just make out his long hair.
Registration is already 1 level underground:
And then you go yet further down to get to the hideously overpriced food area. Seriously, dude: I bought a little 500mL bottle of apple juice for something like $3.50. Do they really think retail investors are so cavalier with their money? Oh... wait....
Yet one more escalator down, and you finally get to 800 level, where the "newsletter presenters" room is, as well as all the booths for all the explorecos you'd never want to see:
There's a portable BNN stage here:
1. I am not you. I am not even like you.
I am not an analyst. Nor a geologist. I'm an electrical design technologist with a degree in philosophy who studies post-modern theory in his spare time.
I conduct no due diligence, I'm a lazy investor, I hang out on Stockhouse, and I even have recently become arrogant enough to feel that fundamental analysis of mining stocks (while certainly providing important support for thinking a stock's price is undervalued) is trumped by chart analysis - in that I don't care how undervalued a stock is if it's never going to go up.
There are a few people whose opinions I value. Read the blog and it should be obvious who. But I realize even they are probably just struggling along in a mist, with some vague concept of what the topology is around them, but without any magical formula that always gives good results.
I'm also just some guy at a computer terminal. So I don't think I'm better than you. Except I seem to be able to figure out stuff successfully sometimes despite not having an advanced background, despite being lazy, despite not really taking things seriously. I'm old enough to recognize my faults and understand there's nothing I can do about them anymore.
2. This blog is for me.
1 year ago to this day, or so, Otto Rock suggested I start a blog, cos he liked my writing style. (That should explain a lot in itself.) I didn't want to. I eventually thought it would be nice to just start one for myself - where I can talk to myself, discuss with myself other people's opinions, and try to figure out where the market's going from here.
This blog is for me to "keep my seven thoughts together", as grandma used to say. Be certain that there are other people in the world who also think bad thoughts - I just put them in a blog.
This blog is public so that, if you are one of those people who enjoys seeing other people's thinking in action, you can sit and watch. It's not public for me to provide a service to anyone. I have no service to provide, see (1) above. And none of my thoughts come with any warranty whatsoever. In fact, you might have noticed I always change them, because I keep finding out that they're wrong.
I follow some other people's assertions. I try to take other people's observations and assemble them together with duct-tape and carpet-tacks, to make my own narrative. And I keep changing it as data comes in.
3. I do this for fun.
Otto likes my blog cos I have a sense of humour he likes, or so it seems. That should say something in itself - he might find I come up with a good idea once in awhile, or maybe GT thinks I come up with good counter-arguments - but mostly it's that I'm the nasty humour guy.
I'm not taking any of this stuff seriously - in fact I can't. How the hell do you take this stuff seriously? Really, I don't even take my own life savings seriously - that should be obvious to you, cos if I did take it seriously I'd be buying SPY and AAPL, not stupid explorecos! What am I, nuts?
This includes (in case you'd been wondering) my "senior gold miners suck" and "JP Morgan and the Joos" memes. I'm also not really a neo-Nazi, a survivalist, or a conspiracy theorist. Except I also am. But not seriously.
Pay attention to the big disclaimer at the top of my blog. In the words of anarchist Bob Black (hero of mine), "you may wonder if I'm joking, or serious? I'm joking and serious."
4. None of this matters.
This is meant to tell you that I'm not venting anger towards anyone with this blog. It's a waste of time, and frankly nobody on the internet is important enough for that.
Here's a story: my sister died in the fall. (You might have wondered why posting was light for several months.) I was the one member of the family who was left trying to get her buried. Other family members pulled a bunch of shit, such that it took me several weeks just to get her cremated, then a few months to get her remains put somewhere.
My time was horribly wasted by these bozos. They were causing all sorts of unrest in the family. This sort of crap wouldn't have happened years ago when my dad was alive - he wasn't a cruel or mean person, but he had no patience and a nasty temper and if anyone had tried this with him would have smacked every one of us into line (even people who weren't involved) and told us to shut up and do as we're told. I respect him for that.
So, what did I do? I asserted my position as patriarch. Family obviously needed one. I told everyone that the offending members of the family were cut out. They are no longer family. Nobody is allowed to speak to them, or of them. And anyone who has a problem with me can fight me to take control of the family. I'm shit serious here.
It's a bit complicated because one of the people being cut out is the son of my dead sister. And I had to put her (very small) estate in order for him (he's up in Nunavut on a contract so he couldn't come down and do the work himself).
But still. That's what I do now. I don't bother picking fights on the internet. OK? I got enough of that 2 decades ago hanging out on talk.politics.libertarian and alt.society.anarchy. Now I just cut the person off. No person on this internet is going to be as nasty a fight as the one I just spent months going through with my own family.
So if I'm talking to you, referring to you, or saying things about you, it's because I like you, or at least respect you. OK?
At the same time, when I put the boots to the CEOs of mining companies whose performance has stank, I do it because they are CEOs, they are paid to be gods among men, and nowhere in Engineering should you be allowed to get paid a fortune and screw things up. And anyone who thinks CEOs shouldn't be criticized for poor share performance is an idiot, since they are directly responsible for every aspect of their company by definition. Seriously: why do guys like Black and Ganoza successfully make an utter bloody fortune pulling gold or silver out of the ground and see their share prices go up? Luck? Is that it? Are they luckier than the guys at AEM or K?
5. I am (am not) a nice person.
I come from a town full of steelworkers, and grew up in a steelworkers' neighbourhood. That was the middle class. OK? I come from a nasty world. I grew up nasty. Ever read Call of the Wild? Lord of the Flies? Okay, that's where I grew up.
But I am also a nice person. I am happy to hear other opinions. And I'm not ever trying to pick a fight with you - because where I come from that sort of thing gets you beaten up.
But I do tease, and if I do, it only means I like you. It's a north English/Irish/Scottish thing, look it up, Malcolm Gladwell touches on it.
6. No fucking smiley faces.
I refuse to use smiley faces. That causes most of my trouble, I know.
Today is "shit or get off the pot" day, I guess. $HUI (worthless miners) and GDXJ (some actual good miners) both threaten to bust below a trendline.
Silver down, gold down but still within last Wedesday's candle, copper down too strangely. UUP is even with Friday - this isn't a "US dollar goes up" day, not yet. JNK:LQD is down, but still within range. .INX and .IXIC aren't looking particularly bad.
It's still Retail Hour so I guess we have to see what happens later on in the day?
Sunday, March 4, 2012
And... more unsellable condos.
The Ruins of Undermountain. I couldn't find the bar, and the newsagent no longer carries WSJ or Northern Miner, so it seems.
Union Station. Looks nice. I'm not 'arf bad a photographer, me.
The nicer part of the Skywalk.
1. Mickey Fulp
His talk was on "the good, the bad, and the butt ugly" of resource stocks.
Basically, he says you need to pay attention to a company's timeline, cost of production, access to capital, and exist strategy. Importantly, "selling to a major is not a generally viable exit strategy".
Some examples of "the good" that he gave were Curis, Goldgroup, Uranium Energy Corp., and Strathmore.
The bad? Smelters. Polymetallic VMS or Pb-Zn-Ag. Ni-Cu-PGMs-Co. And porphyrys - he says minimum 5 billion lbs Cu is needed, and they're so damn expensive in CapEx that all you can do is sell to a major - and as he said, don't invest in a company with only one exit strategy.
The butt-ugly? Moly - juniors can't compete. Tin - controlled by a consortium, you can't compete. Sub-economic deposits - he gave the example of Macusani, and says he doesn't think there'll ever be a mine there, there's no continuity or grade. And he says avoid "unconventional deposits" like the Duluth gabbro, or specialty and ferrous metals.
Now, even though he hates Ag-Zn-Pb, he loves Fortuna because they have a dirty smelter to send their ore to.
He also likes porphyrys if they're near mines or mills - he says Antares probably only works because of Las Bambas.
Most importantly, he says graphite is "the next big thing". He says "remember, I picked REEs in 2009! Well, now I'm telling you graphite is the next big thing!" And his pick there is Flinders Resources.
To which I have to say:
2. John Kaiser
This guy is good, real good. He kept firing digs at the goldbugs all through his talk. He's not a doomer after all! Gold, to him, is just insurance - which is just what I say.
Basically, he notes that the bias in the market right now is that gold has peaked as a bubble. DCF models are assuming $1300 gold. If it goes higher, the market thinks it can only be for bad reasons: and that means miners don't profit from increased gold price.
Now, he says all we need is for gold and silver to maintain current prices, and miners will do well. Again, this is the first hint of what was a constant through the day: people thinking that the miners just have to go up from here, they're undervalued, blah blah.
He notes China is the world's largest gold producer right now, and they keep their own gold.
Kaiser loves Nevada Exploration. He says McEwen thinks they have a way of finding sub-gravel gold, some sort of secret map, or even a codex stolen from the lizard people or something. So, he says, buy some NGE just in case cos McEwen's teh smrt.
He notes that gold's low came at the height of American supremacy, and gold went up as anxiety over US supremacy rose. Basically, there's structural change in the world, and while that's going on, gold will go up.
Oh, and he likes Geologix. Apparently. I dunno, it was on a slide of his, but he was running late so he just zipped past that slide.
3. The Cookie Monster
He noted Kaiser's figures re: the increase in gold production are wrong. He notes "these future production numbers being bandied about are coming from the miners themselves. And we know for a fact they're not meeting their production targets or timelines."
BTW, he said it'll take 10 years to get Atac into production. I guess that's why the price is going to languish for years?
Brent notes average cash costs have gone from $340 to $620 in 5 years. And all-in costs at the majors are $1200/oz. Meanwhile Brent asserts discoveries are declining, and becoming more expensive to find.
Oh, and he made fun of Lakeshore Gold. He also made fun of someone in Mexico who had recent drill results; he says (and the photo he posted makes evident) the topology means you can never have a mine there. Is that Geologix he's talking about? (EDIT: Cookie mails in via Otto Rock and says "no, it's not Geologix." See comments below. So stop selling Geologix!!!)
He says don't bother going after anything small, it'll never make any money for you anyway.
He likes Lydian as usual: at $1500 gold 5%, NPV=$1 billion, but it has a $270M market cap. He also likes Eurasian (EMX) - they have a revenue stream so they don't have to finance again, and he says Koonenberry could be a district scale deposit.
Cookie's on BNN Wednesday night at 7PM. Please, half a dozen of you ask him about Geologix. (EDIT: no, you don't have to ask him about Geologix. Um, ask him instead about zee beeyooteefool Daniela Cambone. Or maybe why Sabina Silver sucks so bad.)
4. Dominic Frisby
I only caught the end of him. Apparently, he buys and sells based on the chart. So Otto would hate him.
Basically, he follows the 21DMA and 55DMA (simple or exponential? I don't know). When the price is above both, both averages are flat or sloping upwards, and the 20DMA crosses the 50DMA, you buy. When the other thing happens, you sell.
Yes Otto, it doesn't matter what their deposit is like or how good their geo is and so on. You buy on a signal and you sell on a signal, end of story, say goodnight Gracie, goodnight Gracie.
Again, Frisby says the CDNX is brutally cheap compared to gold. To which we reply "so fucking what?" Things can remain undervalued for a long time. They can get even more undervalued.
Oh, and Daniela Cambone was in the room. And she's rather tall, and even more beautiful in person....
5. Adrian Day
His topic was "is the resource sector done for?"
He knows his economics.
He notes the LTRO boosted the ECB's balance sheet by E400B since last summer. Easy money is everywhere, and it's unlikely to change very soon.
Countries have been diversifying out of USD - not selling, mind you: just they now buy other things more and USD less.
He notes emerging Asia is increasingly independent from the US economy: now the largest destination for Asian exports is Asia. And he doesn't see this macro trend changing anytime soon.
As for resources? He notes that there have been long cycles for resources. The shortest over copper cycle has been 17 years from trough to peak: the present cycle only began in 2001, so we have many years left unless this time is different.
He notes the longest copper/resource bull cycle came about because of the industrialization of the UK, Germany, and then the United States. He notes with China (and all the other Asian countries), we're still a long way from the end of this cycle. In fact, he put up a "typical copper per-capita consumption" curve for industrializing countries - and noted that China has only gone half way so far. China right now uses 40% of world Cu. So he thinks we can see China's Cu use doubling from here because they have longer to go on the curve. The copper industry is simply unable to meet this demand.
So there you go. Be long copper.
6. Jeff Berwoahyougottabeshittingme
I only caught the last few minutes of the Anarcho-Capitalist Freedom Fighter And Hero Of Ayn Rand's Next Dystopian Novel.
But holy fuck.
#1, the guy does not understand ratios. You cannot do analysis until you go back and finish grade 6 math, Jeff.
#2. He really really really really really went out with a bang. Sure, he talked about moving your gold to foreign countries (so that when society collapses you just have to walk to Zurich to get your money and... wait, what?). And he can help you get a fake passport - it's a little gray-market, but it'll only cost you $30,000. (I know a guy in Canada who does it for 4 figures, Jeff. Too bad you hate socialists.)
And then it went off the rails. Collapse is only a few years away! Get in shape! Take self-defense! Arm yourself! Maybe move to a farm! Canada is as bad as Hitler & Mao! Etc.! Etc.!
Holy shit dude. I used to follow the US Aryan patriot movement, I used to listen to Sean Kennedy, Heck I even listened to Alex Jones once in a while. Dude, Jeff - you're an extremist to these guys.
Oh - and by the way? Good move, moving to Latin America to your little Libertopia. That will truly safeguard your liberty and freedom, yup. Cos it's not like every single fucking Latin American country has had both a fascist dictator and a communist insurgency during my lifetime. Real smart move.
Oh - and by the way? When societal superstructures fall apart, we devolve into a localized traditional society. Where everyone looks out for each other and co-operates. I know, I've seen it first-hand. The guy with the guns? He starves to death. Actually, he diesn't get to - he's the fucking target. "Hey, there's a loony over in a bunker in the countryside, and he has a bunch of gold coins and 50-gallon barrels of soy." "Oh, does he have guns too?" "Yup, quaint eh?" "I wonder when he sleeps?"
7. Marino Pieterse
Loved the guy. He doesn't know how to use a mic (they can't pick up your voice when you're off-axis, dude!). And he's obviously one of the Reformed Dutch, not Catholic Dutch, since he carried on at length about how you've all got it wrong, gold's not going up from here, I've seen all this before, you young people should just shut up and listen to your elders when they tell you how things happened in the past. He was truly scolding us at the end.
He says it's stupid to look at gold pre-1971, because gold wasn't even free-trading before 1971. So all pre-1971 data on gold is meaningless. Throw it out. Got a point there, sir.
He says China doesn't want gold - they want commodities of productive value. He noted, all through Japan's boom, their central bank didn't buy gold. He says the fixation on gold by central banks is entirely a Western phenomenon. He says "Asian banks don't buy gold! Lishen to me! I have been here beforh! You musht lishen to your eldersh if you are to profit in dish vorld!"
He predicts gold bullion will be down at the end of the year. He says Asia buys more silver than gold. He jokingly (maybe?) notes the USD is backed by the Yuan.
He's expecting gold miners to start hedging again.
He notes U will be in shortage by 2013. There was no material impact on U demand by Fukushima.
Marino Pieterse is truly a measure of men. As in, I now refuse to take any newsletter writer, or analyst, seriously, until they beat him in an argument. And watch it guys - this guy will crush you.
8. Vin Maru
Caught the last couple minutes. He seemed like a perfectly normal guy, a kind of brown Otto, -
But then I found out he works with Berwick.
9. Paul Burton
His talk was on evaluating juniors in Ontario and Quebec.
Again, he's one of the guys noting "miners aren't keeping up with gold. So miners must be undervalued." Cough cough. To me, if everyone's saying the market's wrong, then the market must be right and all these guys are missing something big. When I find it I'll let you know, but it probably involves Agnico and Kinross stinking like shit.
His fave producer is Aurizon. Fave developing property is Detour. He also likes Prodigy, Rainy River, Rubicon, and Premier.
But then there was this:
Globex, Eastmain, Bayfield? I seem to remember hearing stuff about those before. And... um... Clifton Star? Do they still trade on an exchange?
So... I'll leave that one for Otto to comment on.
10. JoJo Byrne
He looks like some young kid from a garage band or something.
He had some interesting points. He notes the $HUI once had a trailing PE of 28, and now it's only 15. So, while it's still "gold stocks are undervalued", it's at least a different take.
He thinks there's a bull coming: 2011 was a retest of the breakout from the crash. Yup! A technical analyst is he!
He thinks silver is in a cup & handle - and he thinks it's good that silver stocks are leading the metal. And yes, miner equities can sometimes outperform the advance in the metal being mined.
(I wish I remember which of the talkers it was who pointed out that in a bear, you can have 10-15 PEs, but in a bull, they can go to 40-50. Was that him too? The guy was pretty good.)
He likes AR, MAY, and KOR for gold. He likes SVL, FR and FVI for silver. He wonders what FVI's going to do with all their cash - buy someone maybe? And he calls SWD one of the premier development plays out there.
Anyway, after him I left. He's pretty good though - I might subscribe to him. I'm pretty sure I'll be unsubscribing from Bespoke, since I get enough off their RSS and don't use their daily updates.
So maybe sometime soon I'll post the photos I took. But right now it's time to go. Don Cherry!
I didn't bother staying for Rick Rule. Jojo Byrne was good enough.
Missed most of Berwick, but he didn't disappoint, in exactly the way I intend that to be taken.
Lots of fotos too.
Will probably go to the Daniela Cambone and Friends show tomorrow.
Typing from cellphone so messages will be short.
Vegarra swamped by Chinese investors, can't get to him.
Candente says they'll be a mine. Building a presmelter on own property. Faulkes (?) is a witty guy. Knew immediately I was retail. Very charming and guaranteed to brainwash you successfully.
Hey Otto, you really flunked bad in not looking into Silvercrest when I handed it to you on a platter.
John Kaiser is damn damn damn good. You must subscribe.
Several photos to follow.