Saturday, October 13, 2012

A veritable outpouring of news

There's bearish news, and there's bullish news. First off though,

Economist - a nice story about the world of iron ore production. In case you're interested in learning about iron ore, so that you can avoid buying a sack of junk like Labrador Iron Mines.

Now for the bearish news:

Biiwii - silver's going to collapse! OMG! Aaaugh! Aaaugh! Thanks Gary, you just drove me to cash. Though to be fair, I've seen a bunch of my topped-out stocks start to fall back down (though admittedly in the case of PLG and SVL it was because of this fucking fad of October financings), and GT's $HUI 500 support level was broken, so I'm happy to get more cash and reposition for when the miners finish a little October correction. Which I think I might see. Already have a shopping list for when it comes.

Reformed Borker (Bork Bork Bork!) - his gut feel is that the market is going bearish now. Quote:

Higher opens are also being faded, guys are talking about "the typical mid-morning sell-off," without realizing what a classic sign that is of a tired tape that's run out of firepower.
And yet there's all this bullish news:

WSJ Marketbeat - dollar death cross may presage bull market for stocks. But of course, first we have to see stocks go bullish. And also, you gotta wait to make sure that the weak US dollar proves its correlation to stronger stocks - cos things might be different this time.

WaPo - US exporters are doing better than you think. With caveats - what and corn were down obviously (because the rest of the world didn't have a drought, just the US did), and exports got creamed as the European recession deepened.

FT Alpoville - the coming US housing boom. Roger Altman notes that US construction employment is down to a 1990s level, and the housing bubble didn't create an inventory bubble, only a price bubble. So, when housing gets back on its own two feet, it'll provide a strong support to the US economy.

Bespoke - China's broken out to the upside. In case you missed it.

FT Alphaville - Portugal getting better. Maybe people will stop freaking out about Spain and Italy and Greece and Cyprus and Slovenia when they see yet another country coming out from a collapse.

FT Beyond Brics - Poland realizes austerity is bullshit. Seriously, one thing those fucking cunt Germans hate is being shown up by Polaks. So when Poland's stimulus fires up their domestic economy, it'll be the end of this austerity bullshit in Europe.

Upside Trader - coal's forming a bullish bottoming pattern. In case, y'know, you missed it.

FT Alphaville - Citibank accepts the chances of Greek exit are down. And as far as I'm concerned, the chances are zero, since if Greece left the Euro (1) Germany wouldn't get paid for all the tanks and subs they just sold to Greece, and (2) Germans would no longer be able to buy Greek seaside villas. Give the idiots at Citi time to figure it out: these guys learn "economics" at school, not "political economics", so they have no clue about the political drivers of anything.

NY Times - Krugman says "I told you so". As he notes, austerity has driven the world back into the clutches of recession. Maybe this is bearish - after all, gloating by Krugman will just push the politicians back into the warm embrace of dictator-loving fascists like Hayek and Mises.

FT Beyond Brics - rich people in China, watch out. Long term this'd be bullish for China, since a reduction in corruption would mean more capital being assigned to productive endeavours and less going into the pockets of political thieves. And I find it telling that Chinese bloggers are even allowed to post about corruption - with the State's power over all media, this must mean that the Chinese party leadership must want the corruption stopped.

Oh, and by the way - the bit in that story about watches is funny. See, a few months ago the story came out that luxury watch stores in Hong Kong couldn't move inventory anymore; Westerners interpreted that as a sign of the Chinese economy collapsing, but all it really showed was that the ultra-rich no longer consider it wise to use luxury items as conspicuous status symbols.

That's why I was more interested in the bullish holiday week travel figures, and less on last week's reports of gloom and despair in Hong Kong and Macau. See, the rich (either in China or here) don't contribute a fucking thing to the economy: except of course for corruption, graft, and the end of democracy. It's the working class who need to benefit, in order for an economy to grow.

So in sum?

When I add up all the news above, I can accept the TA (and historical) case for a correction, but still think the medium trend is up.

So I'll take a small break from trading, protect my wins and my capital, and reposition for a big thrust in a couple weeks!

Friday, October 12, 2012

Friday Videos - Portishead

Here's Portishead on Jools Holland:

New game: wordclouding Zerohedge and IKN

So, y'all know there are some posts on ZeroHedge that are especially ripe for mocking: the repetitive libertopian Randroid screeds.

Well, there was one on ZH today, and I've always liked Bayesian linguistic analysis, I thought "wouldn't it be neat to do a word cloud on it?" And interestingly, there seems to be a word cloud site on the net that works without using Java on your own computer.

So here's a link to the article, and here's the things this guy considers so important that he's got to repeat the words over and over again:

Big surprise, eh?

Meanwhile, here's a wordcloud of IKN's big LSL post from the weekend:

Rather different vocabulary, eh? Larger words too, when you omit the libertopian buzzwords in the first example.

Anyway, have fun with it yourself.

Thursday, October 11, 2012

Random bits of news then I'm off to rake leaves

Beyond Brics - Carlos Slim is jealous of Eike Batista, so now he wants to muscle in on gold too! Seriously, guys - when the biggest most successful new billionaires in the world start buying up all the gold for themselves? That looks a bit bullish to me. You?

WaPo - markets are up but earnings are down! Are the Lizard People to blame?

WSJ Marketbeat - bearishness at 8-week high. And this despite the markets being up. So what does the contrarian do?

FT Alphaville - EU looking to delay Basel III. Aw, ain't that nice? Relaxing the rules to help out banks?

ETF Trends - Treasury ETFs and stock ETFs have begun positively correlating. It's a turvy-topsy world. What do you think the reason is?

Sandstorm warrants. No, the other kind.

Call me crazy, but I just bought 500K Sandstorm warrants.

No, the other ones. Sandstorm Metals warrants. SND.WT. $0.70 strike December 2012.

This is not investment advice to anyone. This is one of those things where I could lose all my money.

Stock Gumshoe notes 3 of their streaming partners are in bankruptcy or defaulting on their delivery obligations (e.g. Terrex is in default and NovaDX are getting their asses restructured) and basically they've now been rescued a bit by SSL who cut them in on a palladium offtake on one of their own deals.

On the other hand, SND is going up strongly right now. On increasing volume.

On the other hand, that's cos it's a Porter Stansberry promotion that got called out early by Stock Gumshoe.

Yet on the other hand, Nolan Watson did buy 445,000 shares in late September.

On the other hand, Marin Katusa was promoting SND back in August.

On the other hand, SND is a streamer, and people seem to like those, and they're directly related to SSL who've been going up for a long time; maybe some SSL stockholders will want to jump horses in mid-race?

On the other hand, one of their streams is a shitty natural gas stream.

On the other hand, natural gas has apparently bottomed and started going back up. Apparently the hydro generators have dumped coal and gone with gas.

On the other hand, the bankrupt companies whose assets SND would seize? They're coal properties.

So, why not risk a bit on a one cent warrant? I'm up $17K this month, with more profit to come later on, so why not try to leverage some of that win into even bigger win?

This is not investment advice. Seriously, please don't do what I just did. I'm probably a moron for doing this. I'm only trying to fit in with all the other people who invest with Porter Stansberry and Marin Katusa.

Quick note from work

Quick note right before the open.

I came across something somewhere (Bespoke probably) that noted the markets have now become less correlated.

1) that's usually bullish, and 2) that means there's less of this stampeding fear we saw over the past 2 years, and 3) it means you shouldn't automatically assume that the miners will collapse just cos/if the S&P 500 is going down, or the materials sector (eg Alcoa) is going down, or world trade oriented sectors like the $SOX is going down, or China is going down.

More succintly, this isn't last year's playing field, so don't go applying last year's analysis unthinkingly.

I.e., there won't necessarily be a strong GSR swing on a risk-off, nor on a JNK:LQD swing, nor on an S&P dive.

Wednesday, October 10, 2012

This is how the internet finds my blog

All the fucking fantastic content I generate day in and day out, and this is how the internet sees me?

Fine. Here's a sentence full of keywords to fuck up Google forever:

Jerry Sandusky and Mila Kunis posted the completely wrong Amber Tamblyn and Hulk Hogan youtube sex tape to Facebook in time for the nude Toyota recall at the Israeli lesbian Superbowl.

Now the internet can go fuck itself.

A heretical take on the semiconductors

Gary Tanashian says people feel the semiconductors are dead.

OK, so here's the weekly candles:

They've been painting a big long triangle since 2010, eh?

Which way do you think they should break the triangle - down, or up? It'd be remarkable to see SOX break below the 200 week EMA, considering that's also where the bottom side of the triangle is.

By the way, Bespoke points out that the Tech sector is lagging because it's the highest exposed to ex-US markets.

SOXL is the 3x long ETF and SOXS is the 3x short ETF. Just in case, y'know, you wanted to play along.

Quick and important comment

The S&P and Nasdaq are diving.

Yet silver and gold, and the miners thereof, aren't actually going anywhere.

Therefore my reading of the risk of junior miners is now lower.

Tuesday, October 9, 2012

I apologize, but here's a Turd Ferguson post

I know, I know, he's a loon.

But today Turd Ferguson thinks there won't be much of a silver raid, and he gives some decent reasons.

Here are his points:

  • As stated here often as of late, all reports are that physical demand in London remains robust, regardless of dips or rallies in paper price
  • Gold priced in euro and Swissie just made new all-time highs last week and have been preceding gold priced in dollars by about 4-6 weeks.

  • (loony stuff deleted)

  • RSI levels in both gold and silver have worked off excesses built up during the 4-week rally from mid-August to mid-September.

  • The silver smash of 5/11 and the gold smash of 9/11 both came during periods of ending or non-existent QE. The Fed just announced QE∞ last month and those $ are just beginning to slosh around. Give it time. Additionally, QE∞ only adds to and increases global demand to exchange fiat for hard assets.

So take that for what it's worth. It's entirely possible he could be right on a couple things once in a while, at the times when he turns his back on fantasy and participates a bit in reality.

Google Finance: "Jordan Roy-Byrne now super-famous"

Anyone who pulls up the royalty plays on Google Finance (which is basically everyone who follows Cramer or Motley Fool) will now hear of Jordan Roy-Byrne:

He's super-famous now! Corvus is definitely going to the moon today!

(Just having some fun.)

Monday, October 8, 2012

Blah blah CoT blah blah silver net short blah blah

Clive Maund got into Gary Tanashian's brain and left a turd (Ferguson) in it, along the lines of

"A bloodbath is imminent in silver!!!!1!eleventy!!"

Now I don't like the CoT either, with all the lines going 3-sigma:

But that doesn't mean much, cos I can't see any extreme damage the last few times we were in 3-sigma territory.

Do a google search for "CoT silver net short" and you'll find all sorts of hyperbole.

Then maybe you'll find a piece of actual explanation of how the silver market works. Like from this guy on some bulletin board somewhere:

All the time I see talk about JPM's short position, JPM's socalled troubles with it at higher silver prices, JPM 'caught pants down' and more alike.
I think it's time for an explanation as why this doesn't make sense.
JP Morgan is a BULLION BANK. A company that SELLS silver. It resides on the SUPPLY side of the silver market.

The supply side, the side that SELLS silver remember, is named 'commercial hedgers' for a reason, their short contracts are a hedge, so that if the price drops, they get compensated for by the short positions. The silver they sell is their equivalent for 'long positions'. If the price rises, they get more dollars from the silver they sell, and they throttle their income by changing their futures position. They increased their amount shorts in the uptrend, simply because the upwards price risk becomes smaller with the uptrend continuing, and they decrease their amount shorts in a downtrend, because the downwards price risk becomes smaller at lower prices.

This entire focus on a short position, is nothing but misleading. This happens on all markets, not just silvers. Very likely those that try to mislead try to shift away the 'blame' for a price collapse (in reality it's them dumping for shorter term profit, in terms of purchasing power). So you're right, the manipulation is sickening, but don't blame the supply side of a market for their hedging activities. If you were a silver dealer, you'd hedge yourself too when the price fluctuates alot and big.

So, JPM actually benefits from the higher price (since they sell silver) and they increase their total short position as a hedge, because the higher the price goes, the more the downside risk becomes, being the demand side grabbing profit. When they see the demand dropping, they decrease their total short position. Look at next COT data, the Producer/* class is the real supply side (Swap Dealers are not real suppliers)

25/09/2012 51659 $33.70-$34.45-$33.90

Producer/Merchant/Processor/User Long 9204 Short 52944=43740 short>INCREASED
Swap Dealer Long 15210 Short 23129
Large Traders Long 35613 Short 4259
Other Reportables Long 9165 Short 6509
Small Traders Long 29126 Short 11477

18/09/2012 50474 $34-$35.1-$34.63

Producer/Merchant/Processor/User Long 9256 Short 51855=42599 short>DECREASED
Swap Dealer Long 13775 Short 21650
Large Traders Long 31582 Short 3990
Other Reportables Long 11623 Short 6660
Small Traders Long 27966 Short 10047

11/09/2012 47272 $33.35-$33.8-$33.62

Producer/Merchant/Processor/User Long 12129 Short 64473=52344 short>INCREASED
Swap Dealer Long 15041 Short 9969
Large Traders Long 30731 Short 3976
Other Reportables Long 10640 Short 5913
Small Traders Long 25261 Short 9471

04/09/2012 44920 $31.95-$32.4-$32.13

Producer/Merchant/Processor/User Long 13030 Short 63435=50405 short>INCREASED
Swap Dealer Long 15315 Short 9830
Large Traders Long 30560 Short 4364
Other Reportables Long 11723 Short 5489
Small Traders Long 23408 Short 10918

28/08/2012 38574 $30.55-$31-$30.83

Producer/Merchant/Processor/User Long 15788 Short 60627=44839 short>INCREASED
Swap Dealer Long 15390 Short 9125
Large Traders Long 29366 Short 5052
Other Reportables Long 10342 Short 6018
Small Traders Long 21898 Short 11962

21/08/2012 32477 $30.25-$30.82-$30.82

Producer/Merchant/Processor/User Long 16571 Short 58895=42324 short>INCREASED
Swap Dealer Long 18264 Short 8417
Large Traders Long 26075 Short 9420
Other Reportables Long 9571 Short 5026
Small Traders Long 24430 Short 13153

14/08/2012 23402 $27.65-$28-$27.82

Producer/Merchant/Processor/User Long 19168 Short 56328=37160 short
Swap Dealer Long 20559 Short 6801
Large Traders Long 23461 Short 12907
Other Reportables Long 8856 Short 3823
Small Traders Long 21754 Short 13939

See how they increased their short position during the price uptrend?

Notice the reversal on 18 september at spot price $34.63
There, the uptrend stalled and profit was grabbed, price down, and the SUPPLY side decreased their total short position.
This happens on all markets, in some cases (alike COPPER futures) the commercial hedgers frequently are net LONG instead of SHORT. And why? Simple: if the demand side (ex large speculators) generally bet on LOWER prices (thus net short), the commercial hedgers have to inverse they hedging strategy, being taking a total net long position. So what the commercial hedgers/the supply side does, is as said: hedging themselves against consequences of speculation.

So, if you blame a bullion bank (JP Morgan in this case) for having such a large short position, you are actually blaming a consequence instead of a cause, you missed that this implies that on the demand side of the market, there is a large long position, and those are the speculators, hunting for profit, by buying silver shorter term to dump later on for profit.

Another thing worthwhile to add: the commercial hedgers are usually the best informed people on the market. They are the supply side, they know better than anyone the market situation. So instead of blaming them, you should look at what they do, it has a very high chance of telling you what comes next.

So yes, silver might collapse horribly. Or it might not. It depends on the market, and supply & demand.

Gold Report interviews Jordan Roy-Byrne

It's Jojo!

He fails to sufficiently rub it in other newsletter writers' faces that he's strongly outperformed the GDX so far this year.

Other than that, I disagree with him on macroeconomics, and doubt we'll see the highs in gold and the miners that he predicts. Then again, if he proves me wrong I make more money, and that's fine by me.

Then he really loves Corvus Gold,

 which is an exploration company that has performed fantastically. Corvus has joint-ventured its projects in Alaska and focused most of its resources on its North Bullfrog project in Nevada. Not only does North Bullfrog have substantial exploration potential, but also Corvus has already outlined a deposit there and put out a preliminary economic assessment (PEA). The PEA showed that the project would be extremely economic, even at lower gold prices, with payback at about two years, even on a $1,250/oz gold price.
It also has fantastic exploration potential. Part of the deposit is on privately owned land, which means it can be permitted much faster and get into production much more quickly. Potential production is targeted for 2014. Corvus has tremendous management, which has done everything right to this point. Even though the stock is already up over 100% since we first recommended it, I still believe it has substantial potential from here. Any exploration success in the future, which is a possibility, would be a major catalyst for Corvus' shares. 

Which is nice cos I got $30K there so I'll be happy to see a pop from the interview.

Then he also likes Primero (take that you dastardly shorters!), Northern Vertex (which I haven't looked at) and Argo (obviously) and FNV & SSL (like everyone else nowadays).

David Bond's writeup on Liberty Silver

Yeah, I just can't shut up about the Liberty Silver, can I?

Here's that David Bond with his writeup. Quite eager and excited.

Again, only putting it up here for those people who are interested in seeing the promoters' opinions on the matter. 

Liberty Silver Corp’s
Trinity Project:
Right time (now)/Right place (Nevada)/Right metal (Silver)
A Special Report
David Bond
Liberty Silver Corp.
Shares Outstanding (SO): 80.1m; FD: 97.6m
Recent Price: $ 0.71 (8.27.12 intraday)
Lovelock, Nevada – A stone's throw away from Coeur d'Alene Mines' (NYSE:CDE) fabled Rochester Mine, a brief drive out of Lovelock, Nevada, upstart Liberty Silver (TSX:LSL) is girding up for production at its Trinity silver mine, a high-volume, low-grade open pit silver deposit originally drilled and developed by U.S. Borax.
Liberty Silver has moved aggressively into the silver market, and largely under the radar, into the stock market as well. The company leap-frogged from the U.S. pink sheets to a full-on listing on the Toronto Stock Exchange, without passing Go, the NASDAQ, or the TSX Venture exchange – largely on the resumes of its board of directors, and on the merits of the property.
Those include Board Chairman and CEO Geoff Browne, who has 35 years' experience in financial services as founder of private equity firm MWI Partners, and who formerly worked with Merrill Lynch Private Equity Canada and CIBC World Markets. Then there’s Bill Tafuri, Liberty's founder, president, COO and director, who has 40-plus years' experience in global mining & metals exploration at Getty Mining, Santa Fe Pacific Gold, Kinross Gold, Central Asia Mining & Kola Mining.
Insiders own about 30 percent of Liberty's common shares – what you want to see – management with a lot of skin in the game.
Most recently – in August - Liberty acquired its neighbour, the 100-acre Hi Ho silver prospect from Primus Resources, effectively doubling its land position at Trinity, and - based upon historical drilling data, doubling its silver-equivalent resources and reserves.
That acquisition, along with the drilling, should substantially satisfy Liberty's 70 percent earn-in on the Trinity property as per agreement with owner Renaissance Gold (TSX-V:REN). Now it will be up to REN to match LSL's current and future expenditures at Trinity, or be diluted out.
Liberty retained Denver-based global mining consultant SRK Consulting to update historical drilling data on the Trinity and Hi Ho properties to Canadian National Instrument 43-101 compliance. Mine construction planning and an additional 20 holes of reverse-circulation drilling were conducted this year with an eye toward putting the open-pit, heap-leach property back into production within the next 18 months.
A tour of the Trinity/Hi Ho property quickly unveils a very conventional open-pit, heap-leach operation. Beneficiated silver-oxide material is of course on surface, which is the easiest to heap-leach, and was what Borax mined for a year before silver prices collapsed in the late 1980s. Beneath this however, are sulfide-bearing ores and vein structures which could well yield higher per-ton values than expected at surface, according to drilling data from Liberty and the historical information Borax and Newmont developed. Step-out drilling results have been as good as those within the existing pit project area.
SRK's Reno, Nevada office, which is in charge of working up final NI 43-101 Trinity data and the preliminary economic assessment, appeared to this reporter as beyond enthusiasm for the project, and see a potential for at least 100 million ounces of silver-equivalent metals.
Of particular relevance to investors might be the interest that BG Capital Group, led by Canada's legendary Bobby Genovese, has shown in the Liberty Silver play. Genovese dropped several million dollars of his own money into the project in Nevada to kick-start the NI 43-101 upgrades on the more than 100 holes already drilled by Borax and Newmont.
“Without having to drill another hole, or spending another penny, we think we're sitting on 50 million ounces of silver,” Genovese told me during the site visit. “It's a $1.5 billion resource. We are on a fast track to production, and nobody knows about us,” he added.
BG Capital pencils out the project, notwithstanding inclusion of the Hi Ho acquisition, as follows: it works at $17 silver and goes strongly north from there with the silver-equivalent price.
Liberty Silver is trading at a PNAV (price-to-net-asset value) based on the following resource amounts:
-0.65x Project NAV @ 24m silver equivalent ounces
-0.36x Project NAV @ 45m silver equivalent ounces
-0.22x Project NAV @ 70m silver equivalent ounces
-0.13x Project NAV @ 120m silver equivalent ounces
“If silver continues to trade around $25 and a significant amount of additional resource is discovered, the potential upside is $6.41 (plus-816 percent)” of the current LSL trading price (as of Aug. 23) of (CAN) 68 cents, says Genovese.
For a more comprehensive overview of the Liberty Silver Corp/Trinity Project story, go to the company’s website at and see both Geoff Browne’s BNN video appearance, as well as the company’s latest PDF presentation.
A double? A 10-bagger? Time will tell. Investors should do their own due diligence. But don't sell the desert around Rochester short, nor for that matter, Geoff Browne or Bobby Genovese either.
This distribution does not constitute a recommendation or advice of any kind.

OK, just one more Liberty Silver post

You remember all that gnashing of teeth about James West and his writeup of Liberty Silver? How the writeup is deleted from his website, and from the Google cache, but you can still find it at the one other site?

I said little about Jeb Handwerger, mostly cos I didn't find much that he wrote about LSL.

Well, guess what? I just found out that he's got a video about Liberty Silver at Youtube.

Funny thing is, YouTube says "This video is unlisted. Only those with the link can see it."

Here's the screenshot....

Funny as to why it's unlisted. I hadn't come across this video before (it's linked from The Gold Report) so I dunno if it's always been unlisted or not. I checked a couple other of his uploads, and they weren't unlisted. Maybe the wrong box got ticked?

For the record, here's the writeup that goes with the video:

Liberty has made an explosive move since Mid-August on record volume. Nevada is quite active as it is one of the most friendly and stable mining jurisdictions in the World. Liberty's neighbor Coeur produced over a 125 million ounces of silver. Liberty Silver's Trinity Project was discovered in 1980 and was a past producing mine. Rio Tinto brought this into production between 1987 and 1989. The mine operated when silver was priced between $5 and $9 an ounce and produced 5 million ounces of silver. The project has plenty of blue sky potential with possibly over 100 million ounces of silver. Trinity is located in mining friendly Pershing County, Nevada. Liberty recently acquired the neighboring Hi-Ho Claims which contains a significant amount of silver. The company is currently remodeling and updating their NI 43-101 compliant resource which will combine recent drilling with the newly acquired Hi-Ho asset. Permitting is very straightforward. Liberty wants to get the Trinity Project back into production within two years, expand on Hi-Ho and continue to explore blue sky targets. Underneath the oxide is a large resource of sulfides with excellent metallurgy with a 90% recovery. The silver on the project is associated with lead and zinc, which will be significant byproducts. Liberty has an experienced geological team with a lot of experience building deposits in Nevada. The company is looking to get into production with two years. We can expect developments before the end of 2012 on metallurgy of the lower grade sulfides. Liberty is working on a PEA by the first quarter of 2013.

While the video is still up, maybe you want to watch it. As for me, if I'm going to watch anything tonight, it's the next episode of Boardwalk Empire, not this.

Is there a "S&P ex-Apple" fund?

Considering AAPL is worth something stupid like 30% of the S&P 500, how much of today's broad market decline do you think is all down to Apple?

(Okay, I made up the 30%... blame the Republicans, they've made it cool to make up numbers.)

Motley Fool on Sandstorm, and an opinion which will cause the stock to crash 30% today alone

Here's the Motley Fool article on Sandstorm Gold from Friday. Also, Cramer interviewed Nolan Watson. Onm the tee-vee and ever-thang!

On the one hand, you can justifiably say "uh-oh - a 1-day megapump".

On the other hand, when was the last time that the lamestream media all jumped aboard any junior miner? What sort of a boost do you think you'd get once the toothless hayseed goldbugs get swamped out by a great surge of the masses?

This was my email to someone this morning:

Y'know... I can see why Cramer would like them.

Juniors are desperate for cash, and there are only a few streamers to go to for funding. If there was competition in stream financing, the streamers would make less money; but instead there's very little competition (e.g. FNV only works with majors, so if you're a junior your only choice is SSL) so it's a buyer's market for streamers.

And the streamers have a high moat around them - wanna start your own streaming company? Good, just start with $1 billion in capital, and... wait, what?

Plus there's the suspicion (I heard at TRIC 2 weeks ago) that one day the PRC Central Bank, or Dubai, will come in and outright buy one of the streamers, as a way to fill their coffers with gold for the next 20 years - which shouldn't be getting too cheap any time soon, right?

And streamers can pay a dividend, and still plow excess profits into buying more streams. See how much SSL's financing last month killed its stock price? Oh wait, it didn't....

Who knows. Yes SSL is a gross bubble right now. Then again, maybe this is what it looks like when the mainstream likes a PM company all of a sudden?

Again, to me, it's important to know when your playing field has been swapped out with a new one.

Then again, maybe all the instos who have been in SSL since $1 pre-split are now dumping shares to retail at $15.

Then again, that doesn't mean they're smart for doing so.

Anyway, I own $10K in warrants, but on the Canadian exchange which is closed today for Lieutenant Columbo Day.

Yeah... Canadian holidays are kinda dumb. But at least we get paid to stay home.

The Morning News: a new narrative enters the picture?

Well well well! Silver down, gold down, Euro down, USD up, Europe markets down, Shanghai down.

Yet Spanish yields down also.

Looks like everyone is going generally risk-off, but are unwilling to bash the Euro periphery.

What could be the cause? What is the market smoking today? Well... there are several Eurozone meetings this week, and god knows maybe something positive is said. But then there's also this:

WSJ Marketbeat - Payrolls Reaction Shows Depth of Market Concerns. Here's the money shot:
Steven Englander of Citibank put it this way: “It now seems to me that the market fear may be that lower unemployment will lead to a premature Fed pull back from easy money even though more reliable labor market indicators do not signal a big improvement.”
Are you kidding me? So the market is saying that an unemployment targeting of 6% will mean that QE3 ends... when? Next week? And therefore now's a time to get out of the markets, because when US unemployment gets to 6% the effect on the Chinese and European economies, and the commodity complex, will be... bad? Because... growth? Because... American consumer demand?

OK, there's a clue that the market is becoming stupid and we should get out. As you've seen in the comments section of this blog, it's never good to stand in the way of abject fucking stupidity.

WSJ Marketbeat - Investors Brace for Earnings Season. I.e., Alcoa. Maybe that's the real problem - earnings are a backward-looking indicator, and because the summer has seen a nasty slowdown, the market thinks Kleinfeld's opening aria Tuesday night will tank the materials and the equities? And they're not wrong, since aluminium is in as much of a glut as iron ore right now: Alcoa's earnings should suck.

Then again Alcoa's earnings always suck. If Otto Rock was a Dow analyst instead of the junior miners, he'd call Alcoa a blanket avoid.

And finally, please read two articles from Also Sprach Analyst on the Chinese demographic cliff. Remember though that Also Sprach Analyst is to China what Ambrose Evans-Pritchard is to the Euro: a hardcore skeptic who's always doom and gloom.

Frankly, I'm not too concerned about the Chinese demographic cliff; as long as Chinese productivity can outpace the worker collapse, they won't go into outright depression; also, there are other rapidly-growing populous areas in the world, like Indochina and Latin America, who should take up the slack; also, a strong period of US growth, and an end (hopefully someday) to the Euro purposeful-depression shenanigans should make up for the Chinese slackening.

However, the market is made up of idiot Americans who have a hard time grasping that there are more than 4-5 countries in the world; so I'm sure when the demographic collapse goes mainstream in the US news, we'll see a good strong market swandive for months on end.

Anyway... that's further off in the future. Just keep it under your cap for when you need it.

Sunday, October 7, 2012

Another post on the utter fucking stupidity of German media

Those idiot fucking Germans are at it again.

You stupid fucking Germans, inflation is not the thing you get when you collapse all of Europe's economies with your fascist jackbooted demands for austerity.

According to all economists who aren't fucking fascist right-wing Nazi neanderthal Ayn Rand worshipping corporate-lackey fucktards, what you actually get is DEflation.

As in this:

The Great Depression of the 1930’s originated in the United States, but also severely affected Germany. For years after the inflation, the Germans were dependent on American credit and the associated high interest rates.
The inflow of American dollars allowed the German government to pay its war reparations to other European nations, who in turn used this money to pay off the debt to the United States, which was incurred during the First World War. The Americans then loaned this money back to the Germans.
This system only worked as long as the American economy prospered. After the crash of October 1929, the inflow of money came to a halt. Unemployment started to rise and the public was becoming increasingly unhappy with the economic situation.
Foreign investors began to demand the repayment of their credits and many Germans took their money out of the country. During the summer of 1931, a number of large German banks went under.
The Reichsbank was forced to accept a reduction in the money supply, because it could not meet its standard of a gold and foreign exchange backed currency. The subsequent lack of credit brought many viable companies to ruin.
The government ordered a reduction in prices, salaries and interest rates. At the same time, other governments increased their import/export tariffs and devalued the German currency. Between 1931 and 1932, the German unemployment figure climbed to more than six million. This, along with the deflation, paved the way for Adolf Hitler’s rise to power.

Does that sound anything like what you're doing to southern Europe? But no, it's all about you. Because in your own childish stunted brains you're still the fucking master race and Europe revolves around you. Like when you clamoured for a low central bank rate to help you reabsorb East Germany, and you broke the deficit rule, and Europe didn't mind because they wanted to help you get on your own feet again? Which caused you to overheat the periphery's real estate markets... oh wait, you don't remember that?

"The creeping expropriation of Germany" - is that like how you're sweeping in and buying up all the Greek real estate for cheap, now that you've collapsed the Greek economy? You know, the country with the fascist party waiting in the wings?

Fucking ignorant pig-headed Germans.

If you don't fucking smarten up, in six months Deutschebank will go under. Then we'll see who bothers to fucking feed your starving asses.

Ugh... I figured out Sandstorm....

Uh-oh. Looks like Sandstorm Gold is a top pick with Cramer and Motley Fool. Now I feel so dirty.

And the guys on Stockhouse are saying it should go to $30.

Oh well... I wouldn't have puked Apple on its way up, and I hate the iPhone. And Apple in fact.

The delicious irony is delicious and irony

Here's James West interviewed in The Gold Report, 9 Jul 2012, interpreted in light of the whole Liberty Silver thing that's hitting the wires as we speak:

The Gold Report: Not so long ago, mining promoters—larger-than-life personalities who revved up retail investors about stocks—were an essential part of the junior mining business. But the NI 43-101 limits how much company presidents and CEOs can tout their stocks. Do promoters still have a role or have they disappeared from the scene?

James West: Promoters have not disappeared from the scene. Yes, the NI 43-101 puts a filter on how public companies communicate with the market, but promoters are essential to the life cycle of public companies.

[me here - how did that filter work in this case, Jimmy?]

There was a time when promoters were infiltrated by a larcenous element that would create and promote deals that could at best be described as very optimistic. Back then, these misleading statements could be distributed almost clandestinely. Thanks to the Internet and the NI 43-101, that larcenous element has largely been unable to operate as freely. People hear "promoter" and they immediately think "con artist," which is wrong-headed and a throwback to the pre-Internet era. Promoters now are legally responsible for the statements they make on behalf of a company. As a result, promotion is a lot more respectable.

[Promoters are legally responsible for the... wait, what?]


JW: A great stock promoter can credibly and convincingly convey the technical aspects of a project and the merits of the management team, and can honestly indicate who the other investors are and what the exit strategy is to as broad an audience as possible.

[So were the technical aspects of LSL credibly and convincingly conveyed? The 70% ownership, back-in, NSR, low rock value, lack of capital? And what about the merits of the management team and who the other investors were?]


JW: Arguably, anybody who speaks positively about a public company is promoting it. In our newsletter, we are happy to promote the stocks we invest in because we own them in our fund, and we think they have value. When we write about these companies, we try to articulate a company's merits in terms of structure, financing, projects and management without being too promotional. The idea is to say, "This company is good enough for me to invest in it, and here's why I like it." It is third-party endorsement in its most sincere form.

[So you'd consider your writeup of Liberty Silver to not be "too promotional"?]


JW: The role of a newsletter writer in mining is to convey complex technical concepts in simple terms that a layperson can understand and use to decide whether an investment is appropriate for them. We aid in the function of promoting the stock, but we are not promoters.

[Looking back on things as they stand right now, do you still feel that Liberty Silver was an appropriate investment for the layperson?]

OK, no more posts from me about Liberty Silver or this paid sucker. I've got important things to do today. IKN (and probably many other people) will have a writeup on it tonight, and maybe Monday someone in the press will care enough to go into more detail about the whole thing.

Also, I don't like the looks of the people who've been skulking around my blog these past 24 hours. I'll be saving the net traffic files in case some investigator wants it for connecting dots and such.

James West's writeup on Liberty Silver is gone???

Oops! James West's writeup on Liberty Silver has been deleted from his website! Probably by evil hackers!

It's even gone from the almighty google cache! How can that even happen! Is there no depths to which Anonymous won't sink!

Thankfully though, you can still see the entire writeup at "Before It's News".

The truth is out there!

Weekend news

Here's your weekly news:

New Deal Democrat - weekly indicators. The US economy is still strong. Read NDD every week for your US economic sitrep.

JC Parets - but is it time to get bearish? I think his buddy Richard Ross is full of shit, frankly.

1) The Euro's not painting a H&S unless it's confirmed by volume. If the Euro is painting a H&S then it begs the question of what exactly will send it to $0.80, considering what we've been through already.
2) Crude is diverging the US stock market because of demand destruction. A drop in crude is bullish for the whole world.
3) "India suffered a flash crash. Two months after the US suffered a flash crash, the market was down!!1!eleven!!!" Give me a fucking break. This guy has a job?

It can all be explained by:

Abnormal Returns - investor trauma and the recency effect. Everybody wants doom so fucking bad. I bet the doom premium on the S&P is at least -200 points.

Dragonfly Capital - if you haven't been bullish, you've missed a bull move. The chart is the chart. Don't argue the chart.

Peter Brandt - natural gas has put in a major bottom. Now I remember how much I mocked his shitty, shitty, repetitively shitty calls on gold for the past year. So I won't take his call on natural gas too seriously. And I don't see the final "kick in the teeth" on that chart that you need for a major bottom, like what we had in the miners. And as he says, UNG is not natural gas, so how the fuck am I supposed to play it? Still, the price of natural gas now needs regular attention.

ArmoTrader - gold bulls watch out. Gold hasn't taken out $1800 yet, so we should be worried. Sure. Then again, gold demand depends on China and India, not QE3, so if the US is improving, and we keep seeing positive stories out of China, gold should eventually go up, right?

Our Daniela with Mickey Fulp and Brent Cook

Yup, as everyone and their brother already told me, they finally put up the video. Here's "At the Bar with Brent and Mickey":

The topic this week is, "Is mineral exploration a capital-destructive enterprise?"

And Mickey Fulp really hits the nail on the head. Why is Tommy there?

Also with the "lifestyle companies". Yes, even polite people like Mickey and Brent are unafraid to say the truth when the truth needs to be told. I'm sure Mickey hit 100 CEOs with his remark, but those are 100 CEOs that he should never want to deal with.

And, stunningly, I can't disagree with Tommy's assertion that 95% of newsletter writers should disappear. There are very few writers who are giving you anything more than what you'll find for free on Stockhouse or Agoracom or (gasp) the Yahoo boards. You might as well just buy whatever Stockhouse's thedave2006 buys; he's probably outperformed most newsletter writers.

And as Daniela says at the end: "Who brought Tommy here?!?"