Al's Insights – Wed 14 Sep, 2011

Here’s our take on the situation with Silvercorp

Click download link to listen on this device: Download Show


Featuring:
Al KorelinSean RakhimovRoger Wiegand

Comments:
  1. On September 14, 2011 at 8:37 pm,
    ben says:

    Thanks for this report. special intrest to me as ive owned these shares for some time.
    i didnt sell as i see sc as a good company and the acusations seemed fishy to me.share price will come back could be a good opportunity the way i see it. another form of corruption we need to deal with. a short only needs to start a rumour to make money now. hope it doesnt happen to other companies i have. thanks again

    • On September 14, 2011 at 8:46 pm,
      AlKorelink says:

      Thanks Ben,

      The jury is still out, but I would agree put in my money. On Silvercorp.

      Best,

      Big Al

  2. On September 14, 2011 at 10:29 pm,
    scott hamilton says:

    I recently put my sister into silver corp stock , i myself have owned it several times , at a profit, i am worried as i was skunked by puda coal , [china] a real rip off. i wont buy anymore silver corp at this time , but i am advising my sister to hold on to her shares she has a limit sell order in on it [as usual] ,i also have her in some Harmony gold, and lots of BP oil stock, she is ahead on her HMY but slightly behind on her BP. she loves the dividend on BP. best of luck to you all.

    • On September 14, 2011 at 10:36 pm,
      AlKorelink says:

      Hi Scott,

      You heard what Roger and Sean had to say. I can’t add much other than I, personally, trust both of them. Definitely not telling you what personally should do.

      Best,

      Big Al

  3. On September 15, 2011 at 3:27 am,
    Giuseppe Valente says:

    Hi Guys,
    I have over 3000 shares and am concerned not because of SVM but sentiment. Margin requirements have gone from 30% to 50%. How are you suppose to play this’
    I know that it will work out at the end but what to do in the meantime? Now there is this law firm looking to put together a class action law suite. They are probably looking to take advantage of something not there but this is another issue to deal with. However I see this as great buying opportunity. Imagine having a stock of this quality at less than half the price. Casey recommends a strong buy at less than $7 This is a back up the truck opportunity. I believe people will kick themselves in the behind in the weeks to come if they did not load up the truck. Thank you for the info Joe

  4. On September 15, 2011 at 4:56 am,
    Giuseppe Valente says:

    How can you falsefy NC101 Report? Is it possible? This is what is being suggested
    How can they pay dividends if you are not profitable?
    How can you pay the taxes they pay without profits? you are falsefy profits to pay hirgher taxes? This is ridiculous
    Lastly if whistle blower is so convienced like Roger says why does he not stand up and face the public. What does he have to hide? Who is the one hiding?
    Oh ya let’s not forget that in China prosecution is severe for falsefying documents not like in the USA or the west. So the accussers should not be afraid of coming out here. So why don’t they?
    Lastly Silvercorp has all kinds of watertight documentation to back up what they claim.
    It is sentiment driving the price down.
    This is where the separate the money makers from the loosers. Time to back up the truck people
    Take advantage of the situation because opportunities like this is are rare.
    Tank you Joe

    • On September 15, 2011 at 7:44 am,
      Big Al says:

      HI Joe,

      As I said, I covered this story because of the industry as a whole. We do not need another Bre-X. Especially now with the market being as weak as it is.

      Again, Roger, Sean and I only gave opinions. My personal opinion is based on the logic that you put forth above.

      Be very interesting to see how this shakes out,

      Big Al

      • On September 15, 2011 at 12:10 pm,
        John W. Robertson says:

        Al, I appreciate you and your guests doing some real discovery on this and you’re the first to do it. We certainly don’t need another Bre-X, and I don’t think that’s what this is…the mining industry is well aware of what that stigma can do. It would be all-too-easy for someone to originate a letter out of China (or anywhere) with tenuous claims.

  5. On September 15, 2011 at 5:38 am,
    James Robinson says:

    If I was worried about my life I would also file an anonymous report!

    All the glowing reports and personal recommendations are interesting, but what were people saying about Bernie Madoff before his fall?

    The thing that I found is the increase in short’s the month before the exposure, that really is a red flag.

    I loaded up on this one, if SVM is a scam they deserve some kind of reward for being the best one ever! JIm

    • On September 15, 2011 at 6:28 am,
      Giuseppe Valente says:

      I do not understand what you are saying

      • On February 3, 2014 at 5:23 am,
        Isra says:

        If the short sale has not been approved by the lenedr, you could end up waiting several months for approval, if they approve at all. That’s the mistake sellers and their agents often make when doing a short sale. They put it on the market and fish for offers. They then take these offers to the lenedr and say, “See, this is all people are willing to pay for the home, so we want you to approve a short sale.” But, the lenedr doesn’t have to approve it. And, if they do, it’s a very long process.You should also get yourself a buyer’s agent. The buyer’s agent is paid for by the proceeds of the sale. You don’t pay a dime for their service. But, they do so much for you, including submitting the offer for you and basically holding your hand through the whole process. Once you have secured your agent, he/she will then do all the negotiating for you, including finding out if the short sale is approved yet. If so, a short sale is like any other purchase (only foreclosures are different). I bought a short sale rental condo a couple years ago. It was approved for the short sale and the selling agent told my agent exactly what was the lowest offer the bank would allow. I made that my offer, it was accepted that day, and escrow closed 30 days later.References : Was this answer helpful?

    • On September 15, 2011 at 7:45 am,
      Big Al says:

      Hi Jim,

      At what point in time did you load up on this one?

      Like Joe, I don’t completely understand what you are saying.

      Help,

      Big All

  6. On September 15, 2011 at 7:37 am,
    Clay says:

    I own many shares of SVM and of course there is concern, so this is my take on the issue. Muddy Waters is shorting and has been for about a month or more. Most of these shorts are probably naked shorts, meaning they sell shares not borrowed which will show up a few weeks later as “Failed to deliver”. If anyone checks the following site and list any stock, you will see the amount of naked shorts in last year or more. http://failstodeliver.com/

    Also in my opinion the Central Banks including the Fed have been buying and shorting stocks for last month or so. Just recently the ECB announced it and was reported on Marketwatch, but has now been pulled so I can’t find it. But the fact is, the Fed and other Central Banks have many tools in their arsenal to goose the markets or in the case of gold and silver to pull the plug on all paper transactions. One of these tools they have reluctantly used but are now moving full steam into is, buying and shorting stocks on the markets. If you read Bernanke’s past reports and writings, you will see places where he mentions this as a tool of the Central Bank.

    Point is, these events like in Europe and their banks or the US and its falling economy together with recent moves by the Central Banks tell us just how bad things are getting. Things are really really bad right now and nothing is being improved by actions of Central Banks or their political operatives in respective governments and the buying and selling of stocks by Central Banks would not be ongoing unless things were much worse than most of us can imagine. Because of this, there are many coat-tail hedge funds piggybacking the Fed on shorting gold and silver stocks, just like they do in the gold and silver pits at the Comex and LBMA.

    • On September 15, 2011 at 7:48 am,
      Big Al says:

      Good Morning Clay,

      Your take on this is interesting.

      In the current environment, nothing would surprise me.

      Big Al

    • On September 15, 2011 at 8:35 am,
      Giuseppe Valente says:

      IF WHAT YOU SAY IS TRUE WELL THEN WE ARE FIGHTING WITH ONE HAND TIED BEHIND OUR BACK. THEREFORE WE CANNOT WIN. HOW CAN THIS BE PROVEN
      JOE

      • On September 15, 2011 at 9:17 am,
        Clay says:

        Giueseppe: Al, Sean and Roger are honest people, they may not always be right but who is? Proof is hard to come by but will in time. Faith and knowing right from wrong will prove honest people right.

        The Fed, their associates and many in power politics can not win by winning, they can only win by losing. They don’t realize this which is their undoing.

        • On September 15, 2011 at 9:23 am,
          Big Al says:

          Morning Clay,

          Your comment, “they can only win by losing”, is so very true. Thanks for sharing that bit of wisdom.

          Big Al

      • On September 15, 2011 at 10:56 am,
        Clay says:

        Giuseppe: You will want to listen to this, then you will know what is happening to the US. http://www.financialsense.com/node/6363

      • On September 15, 2011 at 12:14 pm,
        John W. Robertson says:

        The Presidential Working Group is quite real, as we know now. So if you were working on the PWG, what markets would you be targeting today? I’m not suggesting they’re writing anonymous reports. Howard Hunt and Gordon Liddy could tell you why that’s a bad idea. But I think pro-active shorting on the metals markets is quite plausible for the PWG right now.

        • On September 15, 2011 at 12:30 pm,
          Clay says:

          PWG!, We both know what Imperialism will do. It is everything opposite from what the founders of the Unites States believed in. Thing is, such market manipulation ALWAYS fails in the long run and in this case it will be the end of the Dollar as world currency. Perhaps they will continue their tyranny having lost sight of any goal for the pleasures of immediate satisfaction, but we can know for certain that Hitler never thought he would end up like he did and neither will they.

          • On September 15, 2011 at 1:20 pm,
            Big Al says:

            HI Clay,

            I personally would not put anyone in our country in the same category as Hitler. That man was evil incarnate. His deal, in my opinion, was totally different.

            Big Al

        • On September 15, 2011 at 1:19 pm,
          Big Al says:

          HI John,

          Do you think that they really care about little mining companies?

          Big All

          • On September 15, 2011 at 6:09 pm,
            John W. Robertson says:

            Not in general, no. But being one of the larger publicly traded companies in the US, Silvercorp Metals may not be small enough!

  7. On September 15, 2011 at 9:04 am,
    Clay says:

    Giuseppe: True, we are fighting with one hand tied behind our backs, but we are not blind nor dumb. Our opponent is fighting for all they are worth which in historical reality is mostly nothing, so they believe they truly have nothing to lose by doing what they are. History of many thousands of years is on our side, but those of us who are older, baby boomers or before, may well lose the fight for our own posterity,but we fight for our children and their descendents posterity. Remember, we are not alone and we will win, that is written.

    • On September 15, 2011 at 9:24 am,
      Big Al says:

      Hello again Clay,

      Amen,

      Big Al

    • On September 15, 2011 at 1:19 pm,
      Giuseppe Valente says:

      What are you taking about. You sound like a riddle. What is written and where? i believe in the KJ1611 Bible and nothing else there it is written. As for fighting for our children give me a break this is not the years of the real Tea Party. True fighters are out numbered by a huge number and the rest are cowards. Further more people do not even have the constitution on their side even though it is. It has been disregarded therefore you also have to fight the authorities as well as the government workers with thier unions, lobbiests & coorporations. How do you plan to win against these odds. You think you are crossing the Red Sea with Moses? You are whistling dixie. When the crises happens only then if at that can there be a fighting chance. But disaster has to come first. I am a realist Believe in God’s Word and simpe mathematics. Please wake up people and stop wishing upon a star Thank you Joe

      • On September 15, 2011 at 1:24 pm,
        Big Al says:

        Hi Joe,

        Trust me, my friend, I am not wishing upon a star.

        I have seen God make greater changes than simply restoring this country. You have to ask, is He testing us at this point.

        I think that the economic situation is going to deteriorate much more than the point it is at today.

        Europe is literally at the verge of economic collapse. We in the U.S. are a bit ahead of that, but not by much.

        Let’s see if we all pass this test,

        Big Al

        • On September 15, 2011 at 6:14 pm,
          Giuseppe Valente says:

          I was not saying you we wishing upon a star it was clay

          • On February 3, 2014 at 3:12 am,
            Maira says:

            If your insurance coervs only personal property and not business property, then you are obligated to pay back the insurance company. If your insurance coervs business property, then you are obligated to give the company whatever money you received for its computer, which might be more or less than what the replacement cost.

          • On February 3, 2014 at 4:54 pm,
            Deidara says:

            The click fraud rate varies aocrss industries as Andy Beal mentioned in his post Click Fraud Rate Higher for More Expensive Keywords. Some of my advertisers who exclusively advertise on the Google Search Network have received refunds that exceed 20% of their total ad spend. Other advertisers in a completely different vertical have received refunds of only 5% of their total ad spend.

  8. On September 15, 2011 at 9:29 am,
    Bentnail says:

    AL:

    There is news out on the iron-ore explorer “Cap-ex Ventures” (James West pick) – one hole showed 159.5 meters at 31.3% (this is higher grade than neighboring producers in the Labrador region). You may want to add this one to your portfolio – could be a potential windfall in the coming months / years.

    Here is a short video on them, followed by their website (if you have yet to look at the company). I have a few shares (not that my involvement is worth anything other than a hill of beans – LOL).

    http://www.youtube.com/watch?v=pIeJ0oDC0D0

    http://www.cap-ex.ca

    • On September 15, 2011 at 10:29 am,
      Big Al says:

      Thanks man,

      I will take a look shortly.

      Big Al

  9. On September 15, 2011 at 1:55 pm,
    Giuseppe Valente says:

    Silvercorps has purchased today 3 million shares on the open market and will purchase another 7 million the same way in the coming days

    • On September 15, 2011 at 2:15 pm,
      Big Al says:

      Hi Joe,

      Many thanks, I have been so busy I did not look yet.

      Look’s like they are going to get Mr. Short!

      Glad to see that as, again, we do not need another Bre-X!

      Best,

      Big Al

      • On September 15, 2011 at 2:18 pm,
        Giuseppe Valente says:

        Hi Al
        Where did you get your info can you link us
        Thank you Joe

        • On September 15, 2011 at 2:28 pm,
          Big Al says:

          Hi Joe,

          I assume that you mean the information re: Silvercorp.

          Here is one place: http://labemp.files.wordpress.com/2011/09/silvercorp-metals-final-report.pdf (Click on the link on the second page pertaining to the translation of the L&R Bureau)

          Also, go to the Company’s website and read the past releases.

          Obviously, Sean and Roger also added additional information.

          Best,

          Big Al

          • On September 15, 2011 at 3:43 pm,
            Giuseppe Valente says:

            Hi Al you said looks like they are going to get Mr. Short the link is the report not getting the person responsable. By the way when I said wishing upon a star it was not directed to you but Clay
            Thank you Joe

      • On September 15, 2011 at 2:20 pm,
        Big Al says:

        Another comment on Silvercorp.

        Looking at the chart, it is interesting that the Company is buying the shares back at, historically low prices if you just go back a short period of time.

        This definitely falls into the category of “things that make you go hmmmmm! (To quote Grant Williams.)

        Big Al

        • On June 14, 2012 at 4:16 pm,
          Anita says:

          Quoto Vergil; dico solo che KillZone 2 sta continuando a vdeenre molto bene ad un ritmo paragonabile a quello che fu Halo 3; non male.. un gioco da sbavarci sopra per averlo. Di fatto , secondo N4G, la PS3 nelle ultime 10 settimane batte il Wii in fatto di vendita hardware con un trend crescente; guarda caso a seguito dell’uscita di Killzone che sembra essere il gioco pi acquistato insieme alla nuova console (parlo di vendite in Jappone)

  10. On September 15, 2011 at 2:53 pm,
    Big Al says:

    Here is an interesting comment from a listener:

    “Al:
    >
    >The financial media is at it again.
    >
    >A week ago when I had e-mailed you, pinpointing the peak in gold
    >equities, Kitco headlines read like this:
    >- Triland: Gold Accelerates Higher After ECB President’s Remarks –
    >Kitco News, Sep 8 2011 1:38PM
    >- Comex Gold Ends Solidly Higher as Traders Quickly Step in to “Buy the Dip”
    >- Kitco News, Sep 8 2011 2:17PM
    >
    >And now the same Kitco headlines are reading like this:
    >- Gold price decreases in local, int’l market – China Business News,
    >Sep 15
    >2011 2:21AM
    >- Comex Gold Sharply Lower on Technical Selling, Up-Tick in Investor
    >Risk Appetite – Kitco News, Sep 15 2011 8:16AM
    >- Gold drops below $1,800 after central bank action – MarketWatch, Sep
    >15
    >2011 9:53AM
    >- Gold Prices Accelerate Losses on Hot Inflation Reading – The Street,
    >Sep
    >15 2011 9:39AM
    >
    >What a difference just a week can make! It is amusing, however, how
    >these gurus and reporters always come up with an explanation for what
    >just happened but can never tell what is going to happen in advance.
    >
    >
    >Best,
    >
    >Dave”

    Couple of personal comments from Big Al.

    First of all, there is no way that Kitco is going to make any predictions regarding potential future prices of the products which they sell.

    Secondly, I agree with Dave 100% about the “gurus”, particularly those who think that they can predict the future, which is not the case in the examples above. All too often these folks think that they are the prettiest babies in the nursery. I have found over the years that when you start to think that way, very shortly the sky may very well fall in on you. Nobody can predict the future with 100% accuracy.

    Think about it,

    Big Al

  11. On September 15, 2011 at 2:59 pm,
    silverbug (Dave) says:

    If we have a 2008 of credit crunch we could get silver down to the last major high at $21 and gold to about $1400, Au:Ag ratio 70:1. 2008 had a 33% fall in gold and a 60% fall in silver from the highs of earlier that year.
    I doubt that it will happen this time like it did in 2008 but it could. The reason I doubt it would happen quite as bad this time is that silver went down too far this time and then rose x6 in the next 2 years. Gold also nearly trebled after its low in the 2008 credit crunch. The buyers in silver and gold would be likely to come in more quickly to scoop it up on any major price fall this time. Also, gold and silver are in the position of being used as safe haven money much more than they were in 2008.
    It’s all so unpredictable because we cannot know what these mad central bankers and politicians are going to do next. And we don’t know whether they will fail miserably or succeed in achieving their aims, whatever those aim are!/-

    With regard to silver stocks I own some Fresnillo and it had higher highs recently in a real breakout but has made an amazing rising wedge on falling volume that has now broken down…
    http://1000gold.blogspot.com/2011/09/is-this-perfect-rising-wedge-pattern.html
    Is this a perfect rising wedge pattern? I was looking at the new highs of silver miner Fresnillo thinking, “Great! I own some of this stock and it’s going up repeatedly to new highs!” A little later, I read an article on bearish rising wedges and then I thought, “Uh oh!!”
    Things are looking like there is bearish risk in gold and silver at the moment. However, it is darkest before the dawn as they say, but maybe it will get a little darker yet.

    • On September 17, 2011 at 11:28 am,
      Big Al says:

      Hi silverbug(Dave)

      Things have a tendency to look darkest before the dawn oftentimes. No question about that.

      Here is a thought regarding the current and potentially future directions of the gold and silver markets.

      On the Weekend Show I talked with Mike Yorba about the impending potential collapse of the current Greek financial situation. He, along with Grant Williams, are on record as saying it could happen much sooner than later.

      My question is this, when this happens (and I think that it will) there is a chance that capital could flow into U.S. dollars because many folks view the U.S. dollar as “being the best of the worst”. There is a further chance that temporarily this could take “steam” away from the precious metals markets.

      Now, my personal opinion, is that the continued disintegration of the financial situation in Europe will not take steam away from the gold and silver markets. In the total scheme of things these are small markets compared to U.S. dollar markets and even a small number of new players in gold and silver (and I believe that there will be more and more new players) will drive their respective prices upward.

      Short term maybe a drop but, again in my mind, certainly not in the long term.

      What do you think?

      Big Al

  12. On September 16, 2011 at 5:04 pm,
    Simon Forrest says:

    Full disclosure: I have no stake in SVM, nor have an opinion on SVM. I do, however, have a knack for fraud detection and have been fairly successful with identifying fraud.

    I will list my observations to date:

    (A) I’ve read the critical reports regarding SVM; I don’t understand the claims well enough, nor have enough conviction at this juncture, to long or short the stock at this point. Bear in mind, in the past I’ve reviewed similar types of claims and had more conviction to short;

    (2) Those who are short the stock – Muddy Waters and Alfred Little – have been the best of breed when it comes to identifying fraudulent concerns; do not trust me, go examine the facts. Do not be satisfied simply with what others have to say; rather examine the claims, counterclaims, and check against facts. You’ll likely to come to agree with me.

    (3) Ad hominem attacks – going after the messenger, the superficial – does not help arrive at the truth. Anonymity of the accuser does not add or subtract to the claims he/she make. I would not recommend using anonymity, accreditation (or lack thereof) as arguments to undermine the claims of the messenger. I’ve seen dozens (conservatively 30-40 companies just within this year), like Sino Forest, CCME, LFT, to name a few, who do the same exact thing; they attack the messenger, rather than the message. Truth is blind to its master.

    (4) If you do not understand business practices in China, do not, as a knee jerk reaction, criticize those who are. Also, if you do not understand fraud, do not as a knee jerk reaction, criticize those who are experts on fraud. Examine the facts and claims. Don’t take the CEO or anonymous short seller’s word for Gospel. Look underneath the surface and see what validity their claims have.

    (5) Fraud is such a scary word, but ultimately, at heart, it simply means ‘misrepresentation’. Sorry to break it to you, but that’s the real world; people exaggerate, lie, cheat, and steal. The question then is not whether there is fraud (as there usually is in life), but to what degree; what you really should care about is: is this fraud material?

    (6) Contrary to popular belief, a short seller does not want other short sellers to pile on; they want owners of the stock to sell. Please get this straight before you immediately assume there’s some kind of short seller conspiracy; it’s not in their economic incentive to do so.

    7) In my experience (and experience of those with with much more experience than I have) whenever a CEO/mgmt team attacks the messenger and does not address the claims in detail, it’s a huge red flag. I’m not saying it proves fraud, but the narrative is generally not favorable to those long the stock (on a non trading basis).

    (8) If you’re long the stock, you have it all wrong if your approach is: I won’t sell unless fraud is proven. Proving fraud, I assure you, is tricky.By the time fraud is proven, the stock has generally already lost 80-99% of its value. Markets after all, anticipate. Your approach should rather be: I won’t buy/hold, unless I can prove no fraud. Don’t be married to positions.

    (9) Don’t buy or hold simply because so and so owns and/or is buying. You’d be surprised how incompetent, careless, and ignorant billionaires and frauds can be…or you’d be surprised how clever fraudsters can be. Not to mention, we all make mistakes.

    (10) If you place your trust in audits/auditors, study frauds of the recent and older frauds (the famous ones as well as less known ones). After doing so, you’ll probably come to the same truth that I have: audits/auditors are not designed to detect fraud. As such, relying on them to prove no fraud…let’s just say there are scores of folk who have lost fortunes with that logic.

    (11) Don’t trust anything or anyone at face value, in light of fraud accusations. Only verify and confirm.

  13. On September 16, 2011 at 6:12 pm,
    John W. Robertson says:

    I did some research on SVM option contracts. It’s not conclusive, but interesting. Massive put option purchases (about 50,000) were made on Friday, August 26, 2011, just 1 week prior to the Sept 2 anonymous letter. On that single day, the put/call ratio went from 1:2 to 4:1 for the October contracts. Someone obviously knew something and was trying to profit from it. Whether it was the writer of the letter or someone else being tipped off, is hard to say. It does seem like an insider play though.

    It would certainly be gutsy for some

  14. On September 16, 2011 at 6:14 pm,
    John W. Robertson says:

    …one involved in, or related to, the letter writing to have been a buyer of puts..pretty traceable.

  15. On September 17, 2011 at 11:35 am,
    Big Al says:

    Good Morning Simon and John W,

    You make some very good points and we all appreciate your comments.

    I am now just looking at one interesting issue and that is the price that Silvercorp paid for the shares it purchased late this past week and the price of the shares before all of this started. It is a very interesting coincidence.

    Thanks again for your comments,

    Big Al

  16. On September 21, 2011 at 6:53 pm,
    Simon Forrest says:

    Having gone through dozens of these fraud-accused dramas now, I can tell you that pointing to the stock price at any given point (as things unfold) does not prove nor disprove fraud. Don’t trust me; follow the drama of the higher profile cases (Sino Forest, CCME, Longtop ).