Saturday, October 1, 2011

So where's this big collapse?

OK. I'm not going to present you with a million charts. So instead, I suggest you go over to, look up your favourite commodities, and chart a load of resource ETFs for yourself.

But I'll give you 3 pictures:

OK? Sugar, corn, and livestock. Do you see? They're not following copper at all. They're all behaving in their own little world... as if someone didn't liquidate them all month long.

I admit all of these commodities that I'm showing you have a seasonality you have to pay attention to that isn't showing up in these 5-month charts. But we don't care, we want to see what's happened in September.

Most other non-industrial commodities look like the following two:

OK? Coffee and cotton. Do you see? Yes they're downish, but they're in a slower trend that still doesn't really bear any relation to copper. Tin and aluminium are following this same slow move down.

This tells me that the "dooooom and piles of human skulls" story isn't agreeing with the real world data. People are still expected to want lots of coffee, corn, livestock, cotton and sugar.

So why did copper, silver and gold collapse, while cruddy base metals, foodstuffs and cotton essentially didn't?

I'm saying it's cos someone had to liquidate their Cu/Ag/Au holdings. Either physical, in some Chinese warehouse, or notional in the form of ETFs or futures or whatever the rich people play with.

Now, Biiwii just posted a CoT which (I'm going to have to learn how to read these things) he says suggests that a hell of a lot of people just fled the gold and silver markets. That backs this up. People fled Cu/Ag/Au, that's why they collapsed. And while yes, some softs suggest a slowdown, it's not anything major.

Interesting, eh? Go ahead and poke holes in that, but it looks like that's the thesis I want to stick to. Copper, without all the speculation and hoarding, was maybe never worth more than $3.00-$3.50; silver likewise was never worth more than $30; now go revalue your copper and silver miners, and get back to me with what's still a good deal, because I've kinda lost that fear that we've all been told is the next big thing.

Friday, September 30, 2011

Friday videos - the computers have won edition

MC Stephen Hawking - "What We Need More of Is Science"

The Laziest Men on Mars - "The Terrible Secret of Space"

Rude 66 - a cover of Iron Maiden's "Killers".

Yeah, I know, the third isn't a video, and the second one isn't really either.

That just proves that the machines have won.

Gold Fields muestra interés en adquirir Rio Alto Mining

Oh my. I made the Peruvian internet news.

And since the article is in Spanish, here's the Ottotrans:

A guy posted shit on Stockhouse and we take it as a credible rumour.

What I don't get is why Sulliden's price hasn't exploded too. I mean, they mine gold, and they're in Peru, right?

Disclosure: I own 500,000 shares in Sulliden and am trying to flip it for a 50% gain in under a day by pimping a new rumour to the Bolsa.

Copper seems to be hinting at something different

EUFN (the Euro financial ETF) has tracked the SPY pretty well. So you'd think the SPY dive has happened because of Europe.

But for me, the warning bells started to go off when gold dived. You don't expect gold to dive on the threat of bank runs and currency collapse. You'd expect gold to skyrocket, I'd think.

So what's this?

I don't get it. Doesn't copper lead the SPY in an economic slowdown?

Oh hey, I think I'm beginning to see something.... the continued dive in copper is related to a steepening to the China small-cap dive.

So somehow, either Euro problems, or something internal to China, has added a new story to the malaise.

You might wanna ask your favourite media outlets to shut up about Greece. (They ran out of ink for printing tax forms? What clowns. They make Latin America look Scandinavian by comparison. Kick this stupid banana republic out of the Euro.) Cos the real story seems to be something you're not hearing from China.

Thursday, September 29, 2011

Rio Alto insider buying

Yeah, so those 50,000 shares of RIO I sold off at $2.80 or so a day or two ago? I bought them back at $2.50 or so today. News of a road blockade/mine shutdown by some local dink made the share price tank a few cents, so why shouldn't I buy my shares back at 10% less than I sold them for? Just a day or two later?


Why not?

Wish I'd bought more though - I just read on Stockhouse that Rio insiders have bought $3M in shares in just the past few days.

Oh well... if I don't have the opportunity to load up even more tomorrow at an even lower price, I'll be happy to own the shares I have.

Til I sell them to some dolt for more than I paid for them of course.

I really wish Rio doesn't get bought by Gold Fields for a while... I want to keep penny-flipping their stock. This is a great way to make money in a brutal down market.

Wednesday, September 28, 2011

Godawful $HUI, short ETFs, and a rant

I guess somewhere around 490-510, if you get no support, you're dooooomed.

Hope you made hay while the sun shines. Probably the only money left to make now is on the short side....

Though again, every prediction I make is wrong. That's why I feel it's best to stay heavy with cash, and just flip leveraged ETFs during the day when I can see a trend forming - AND I see a good setup (gotta keep reminding myself).

I actually made money today shorting silver and gold-miners - about $2k or so. But HGD doesn't move as fast as HZD (TSX 2x silver bear). I'll remember that.

Here's some US short ETFs, in the 3x sphere, for the especially suicidal:

FAZ - 3x short financials
TZA - 3x short small caps
BGZ - 3x short big caps
DPK - 3x short developed markets
EDZ - 3x short emerging markets
SQQQ - 3x short Nasdaq 100
SRTY - 3x short R2K

But if you're a Canadian like me, and you don't enjoy the bullshit of currency conversion, try these:

HQD - 2x short Nasdaq 100
HSD - 2x short S&P 500
HKD - 2x short copper
HJD - 2x short emerging markets (poor volume)
HOD - 2x short oil
HMD - 2x short base metals
HXD - 2x short TSX 60

Though of all those, shorting silver seems to be the most profitable.

I also don't like the US ETFs because the bid/ask is a load of chickenshit. I want to buy or sell at market, not wait for a fill from some fucking robot. In Canada, it seems the big boys really do try to set bids and asks to follow the instantaneous NAV of the ETF from second to second - they hardly ever go more than 1-2% out of whack. Whereas the chickenshit US ETFs don't even bother to list any bids or asks - don't ever try to buy them at market or you could pay up to $999,999.99 a share for the fucking chickenshit.

Speaking of which, that's another proof that the American empire has ended: you've given up mass capitalism in favour of unfree, inequal, inscrutable markets that can only be participated in successfully by the ruling class and their server farms. And no, you haven't had it taken from you - you've given it up. Because your country still is supposed to be your property, just as your Founding Fathers wanted, and only through your own spineless cowardice can it be taken from you.

Start taking things back. Tomorrow. Something. Anything. If you're reading my blog, I would much prefer to be able to look up to you.

No foot fungus in the Andes

Sorry for the lack of commentary, but I'm darn busy today.

I dumped most of my RIO when I saw no volume this morning. Also dumped some GOZ at a profit, and my YRI & MFL at losses.

I'm now $60K short the miners and silver, and I'm happy that today I have exercised sufficient patience to see those positions get into the green. See, I typically bottom-tick my shorts instead of waiting for a good setup. Then I panic out when I see a 1%-2% loss as the price temporarily bounces back... then at the end of the day I see that if I'd stayed I would have made several thousand $$$$.

So I'm going to try to use this very shorty period to improve my setups, and improve my patience with the positions. I need to do this if I ever want to profit on the short side. Unfortunately, it looks like we live in very easy shorting times. I'd rather learn to short when it's difficult. Oh well.

In other news...

The chatter about exploration in places like the Andean deserts is that it's relatively unexplored and you can still stumble on a massive deposit.

I was thinking about Guyana Goldfields today, and realized something else...

The other thing about the Andes is, the deposits aren't covered in a frickin' thick layer of jungle! So you can see the rocks and everything! Sure, there's still some sedimentation here and there maybe, but you can generally see your rocks.

Boy, those Peru/Argentina/Chile explorecos have it easy. Plus, no foot-fungus.

Anyway, stay frosty.

Tuesday, September 27, 2011

gold up silver up miners down?

Very strange...

Gold is up and silver is up. And yet the senior, producing miners are being driven down relentlessly today. It's as if everyone who recently bought into the $HUI is now treating today like a bounce they should be selling into.

I don't get it. Meanwhile, the crappier stocks are up.

I dunno... I think I'm going to hold the stocks I bought today til tomorrow. I'll assume, for one day, that the rest of the world is a moron and I'm the smart one.

Newsflash: you just got whipsawed, beeyatch.

Silver is up strongly today. Kitco says $32.54.

Gold is up fairly well today. Kitco says $16.58.

Copper was up 3% overnight too.

Seems the day for selling was Thursday. The day for buying back was yesterday.

I'm only at about 27% cash right now, but I'm looking at picking up some YRI, maybe more GOZ if they're still dumping in the $.70s, and maybe MFL and FVI if I can get them cheaply (they're looking like $16.50 and $6 already this morning in the premarket bid/ask).

If AR is slow-moving, maybe I can catch it. Same for some GUY.

I see possibilities for AR $5.60, FVI $6, GUY $7.90, and YRI $15. Try and snap those up, and $70K of buys might make me $5-10K in one day. Dunno if I want to hold them... we'll see how RIO, GOZ and REG bounce back.

Will I go all-in? I want to see how the market acts first - but then again, I probably need to buy very early, like 9:31, and then just watch the market action like a hawk to see if it's a good idea. I think $HUI takes off very quickly today as everyone piles back in.

Maybe it won't happen and I'll get burned. But I really think the silver & gold crash was temporary. Maybe I shouldn't rush. Who knows. I'm playing by ear here.

Monday, September 26, 2011

just to whack you in the face with it, part two

Here's a Financial Times article
on commodities as collateral in China.

Maybe last week what we saw was some major bankruptcy wave in China, manifesting itself in a commodity dump?

And meanwhile, also from FT, is an article that will make you feel better about the future for gold.

I dunno about you, but I tend to prefer the stories that come from real news sources, as opposed to festering internet cranks who may accidentally get the narrative correct but then pollute it with insane conspiracy theories involving JP Morgan, the Lizard People, and the Joos.

Anyway... my stocks didn't do so bad today. I know RIO went down a lot... but "not so bad" means I might get a chance to buy back all my $3.25 and $2.90 shares for $2.40 or $2.00. Cos I know it's still worth more than that.

Buying back RIO in force....

I've got loads of buy orders on the order list for RIO now. In case it totally collapses today.

I would like to thank the morons who bought it off me for $3.25 and $2.90 last week. I will happily buy it back now for $2.25.

That's it for today's comments. On the road I go.

just to whack you in the face with it....

What I'm asking is:

Is someone in China liquidating tons of gold? As well as silver? As well as copper, nickel, and so on?

If so that's not good.

Read this.

3AM - was the low put in?

Interesting. Gold and silver got badly liquidated at 3AM, then put in V-bottoms as they went back up.

What's more interesting, if you look at the Kitco price charts on my webpage, you'll see copper and nickel also put in V-bottoms at the same time, and have now rebounded as well.

Wonder what that means for us? I came in to work thinking of liquidating more stuff this morning, before I go off on an all-afternoon meeting jaunt; now I think I'll stand pat.

I might put in some stink bids for GOZ though... as Otto points out, they have over 30c per share in cash to go along with their earnings. That would mean they're really trading at something like 2-3x EPS plus cash. GOZ is only low because it's illiquid and the panic crew puked their shares into the thin bids last week. I think if I could get more at 60c-70c today, I'd be very happy.

After all, gold's not going below $1550 (bottom of its long-term trendline). Unless it is. But it's not proven that yet. And if they're digging gold out of the ground at a profit you might want to hold their shares, no? I wouldn't touch an exploreco with a ten-foot pole, or a silver miner right now either; but gold miners? Come on!

Grandich, on Korelin this weekend, says he thinks the junior miners are within 10% of their bottom, and says the time to liquidate your positions was on Thursday, not today. I'm going to go along with the odious fascist on this one, since he does seem to get market calls pretty well (except for his disastrous calls on USTs and the USD recently), and the overnight's V-bottom looks promising to me. I did actually liquidate almost everything on Thursday, and while I'm still low in cash (<30%), most of my money is in either already-killed positions (AQM, LCC), extreme potential-upside positions (RIO, GOZ, REG), and one tiny long-HUI position (YRI).

I don't want to go back all-in yet. I'd want to watch today's action before committing any more, but unfortunately I'm going to be either in a car or in a meeting room til after 4PM.

The positive is that if the miners can get better from here, I've only lost maybe 10% in this most recent dive.

There's overnight news about the EFSF/ECB raising $2T to recapitalize the Euro banking system, and acceptance of a 50% Greek restructuring.

I'm more scared about China right now. Something bad must be happening under the surface. Why else would base metals liquidate at 3AM? Ponder that for me. Or go do some reasearch and post it here.

Sunday, September 25, 2011

listen to real traders

Ritholtz is a real trader, and it pays to read him (and his crew) daily.

He's posted something nice about gold today, which makes me feel better.

Basically, I'd forgotten the old saw that gold always pulls back every year. This present gold pullback is only a fraction of what people saw in 2006 and 2008.

See also the NY Times. And of course Grandich is now calling gold and silver a massive buying opportunity.

Meanwhile that conspiracy theorist reject from ZeroHedge, Turd Ferguson, is just dumbfounded at silver losing $10 in 2 days, and blames it on (as usual) a conspiracy by JP Morgan, The Lizard People And The Joos.

(Great band name by the way.)

I still wouldn't touch silver, or silver miners, with a 10 foot pole. We'll see when that might change.

The Mickey & Brent show

What I find funny is how Brent's stumbling over his words and Mickey's all chatty and talking with his hands.

"Geologists are the only alcohol-based life-form". Yeah, well, take it from a former indie-rocker: if that were so, guys, you'd be able to hold your liquor a bit better. :-)

Point in their favour, though... 5 minutes in and I haven't caught either one letting his eyes drift down to chest-level.

Open letter to US Republicans

Seriously. If you want to be Republican, go ahead. Maybe you're a social conservative, and hate gays and Mexicans... okay, I can accept that. I once dated a skinhead.

Or maybe you're a fiscal conservative... um, in which case really you should have supported Bill Clinton, right? He was the last Prez to have ever balanced the budget.

Or maybe you're a Plutocrat, and you want the poor to die and their mass graves to get a Tiffany's built on top - okay, that's fine too. I'm a Satanist and I've read Ragnar Redbeard and Ayn Rand, and I'm no longer poor, so if you want the return of Dickensian brutality, fine.

Seriously, I'm okay with all that. If a society's dominant ethos is to hate gays and mexicans, and give me a 3% tax cut to kill the children of the poor, I can go along with that quite well since it doesn't hurt me. In school they made sure they beat me into submission so I would accept whatever stupid fucking dominant ethos I disagreed with. So if you want the world to be a brutal hellscape, I'm fine with that.

But if you're a Republican, why would you vote for any one of the following idiots to lead your party into the next election?

Exhibit 1: Michelle Bachmann and her little escapade chatting about jackbooted thugs forcing injections on little girls:

And days later:

Bachmann comes out talking like a conspiracy fruitcake, and then just a few days later denies ever having made the statement. You'd really vote for someone who's not only an anti-scientific nutcase, but also a two-faced liar?

(PS, the line about jackbooted thugs forcing injections on little girls - fap fap fap fap fap, is all I have to say. God, Bachmann should be writing porn scripts.)

Rick Perry, meanwhile, is not only nuts enough to take a laser-sighted pistol with him when he walks his dog, but also to get his own collage on craziness:

He also, by the way, days later, lied about having said Bernanke was guilty of treason. Because he's yet another fruitcake who not only shoots from the hip (made easy with a laser sight, actually), but also doesn't have the balls to actually stand by his lunatic statements.

You really have two candidates there who do little more than string together words found on Worldnet Daily into roughly-hewn sentences.

Finally, here's that glorious leading moderate, Mitt Romney:

Seriously. This guy is the moderate? "Corporations are people"? Then that must mean that people are corporations, in which case you should also have the government bail you out for your asinine investing errors, right? Instead of, y'know, stealing your money out of your pocket and bankrupting your retirement plan just to bail out banksters who make asinine idiotic investment decisions.

I mean, seriously. You Republicans are fucked. Ron Paul really is the most moderate, least crazy candidate that you have running for you right now. And if it's one thing I'm not, it's a Rondroid. My god you are so fucked.