Click download link to listen on this device: Download Show
Michael, it appears miners are going to be challenged for some time. If the conventional markets turn down, that won’t help either. Since the fall of 2011, I’ve felt that gold would have to consolidate for some time and that’s what we’re seeing currently. My belief is that Bernanke at the April FOMC meeting will start preparing us for another round of QE. This should help to stabilize precious metals to a degree. We’re in for weeks/months of trading sideways to down for precious metals. What might help miners to a degree would be a break in the oil prices and subsequent decrease in their energy costs. You’re starting to read more and more by “experts” that we’ve seen the highs in the precious metals. Don’t believe it for a minute. This bull has a long ways to run yet but is taking a long due breather. It’s times like these that shake out the weak hands. Are most of the miners going lower?—absolutely. You have to ask yourself if you can stand the trauma of that or not.
Great advice on mining shares Roger.
Michael, I share your frustrations with the extremely poor performance of the gold equities. No other sector has performed quite as badly as the mining stocks have and considering gold is still at very high levels, its even more frustrating.
However, if you’re only down 30% in your mining portfolio then you’re doing much better than most.
The majority of my miners are down 70%+, with the odd one down 90% and one lucky one only down 28% currently, although its starting to drop further again with each passing down day in the resource markets.
The one thing I will add is that this whole idea that we’re in a ‘Bull market’ for commodities and that this is just a pullback, I think is very mis-leading.
To me it seems far more likely that we’re in the Mother of all Bear markets and have just seen a couple of bounces along the way.
If I’d invested in any other sector, other than precious metals, i would have made money instead of losing the majority of my savings.
Next time I’ll know better.
But still if we read the gold newsletters etc, they are still drinking the cool aid and promoting gold stocks that invariably only ever go downwards in price over time.
Good luck to you and hope you hang on to your 70% you have left.
Has the law of gravity been repealed? How about the old adage: “buy low and sell high”? We all know, don’t we, that markets go up and they go down? Meaning that if stocks are really cheap now, if you bought when they were high, you’re probably cursing yourself, but if you’ve been on the sidelines with cash, now would probably be a really good time to re-enter the market. You buy when the blood is flowing in the streets, Rothschild said. You ask guys like Rick Rule or Bob Moriarty, they’re rubbing their hands with glee right now and buying. Too bad we can’t get past emotion and start investing rationally. As Rule says, you’re either a contrarian or you’re a victim.
It definitely appears to be best to hold physical gold/silver as insurance instead of mining stocks, better to invest in other markets and do research on the company you investing in. IT/Technology companies are going to be doing well going forward especially mobile operators.
just at 32 silver the long term mine profits should be great. I have several silver mines in my pocket. I own Houston Energy HUSA . I bought it recently at 11 a share. Some one sold , 1 million shares, and plunged prices down to 5.25 . today moving back up slow. great fields, one recent well , was dry. APA apache looks good. Love to all S
Well this makes me go HMMMMMM! Gold to resume cyclic increase in 2015!
http://www.mineweb.co.za/mineweb/view/mineweb/en/page96990?oid=148236&sn=2010+Detail&pid=96990
More Hmmmm…”Gold unlikely to break records in 2012 – CPM
Gold prices averaged $1,527/oz last year, touching a record high settlement price of $1,889.90 in August 2011. CPM says prices are unlikely to reach that record high again in 2012.”
http://www.mineweb.com/mineweb/view/mineweb/en/page33?oid=148247&sn=Detail&pid=110649
WHAT DO YOU THINK?
And in 2015 there will be another excuse as to why gold will not reach the record high.
We are currently experiencing currency debasement, inflation and all the other symptoms that supposedly drives the metals higher. Instead, look what we have!! Lower metals with even lower prices on the horizon.
And for one last HMMMM….”Goldman Bullish On Gold, 3 Month Price Target Of $1785″
http://www.zerohedge.com/news/goldman-bullish-gold-3-month-price-target-1785
Thanks Robert and Jason. I really believe at this point that the mining shares are the absolute worst place to be. I have wasted the last two years of my life watching them and studying them. And I have gained nothing. Nothing at all. Only have lost so much more than what I started with. It has been a waste of both my time and money. It hurts so much to still own them. I’m wondering if it I should sell them all today, just cut my losses, and move on with my life; this time investing in myself what I have left, rather than investing in these companies that may likely never go anywhere. I have shot myself in the foot by buying into the mining share story. And I’ve gotten myself addicted to the hopium of believing the analysts and pundits who claim that a mania phase awaits in the mining shares. What a joke. Mark Twain is rolling in his grave. A gold mine is a hole in the ground with a liar on top, he wrote. Sage advice right there.
Alas, what to do now? Sell them at a huge loss, or stay addicted to the hopium, with the idea that they really are destined for better days?
I agree. This has not only been a waste of time, but also a distraction from other investments. It looks as if the TSX.V is in for a big roll-over now that will take most if not all the mining stocks down with it. Should have stuck to bullion, no liars envolved.
Dan
Scorpio down 20% today on missed earnings. Glad I sold out on these guys. Expect a lot more of this from other producers.
Dan
Mining companies are a horrible investment. They sell a depleting asset (their PMs) and give you a 1.5% dividend, if you’re lucky. The greedy bastards who run those companies don’t even have the brains to listen to Jim Sinclair when he said last year that they need to increase their dividends to attract new investors. It’s time to get out of these mining companies FOR GOOD and get into the real metal.
By the time these guys do more than talk about what is in the ground the whole commodity run will be over. At least they can plant a garden on the land and grow their own food.
Dan
And for some yet-to-be explained reason, the stock of Rugby Mining, a sponsor of this site, on a volume of 500, had a flash-crash of 25% in value, in seconds. If that’s not a sign to get the hell out of mining companies, I don’t know what is.
Michael,
I truly feel your pain. Investing in gold/silver stock’s can allow someone to reap outstanding profits and also lose large sum’s. It can be exuberant emotional high’s and extremes of devastating emotional lows.
Mining stocks can be brutal to hold at times because they are so volatile. They are simply not understood by the greater market participant’s and most all of them are being illegally naked shorted to death.
I think if you hold these miners for a longer period, say over the next 2 to 4 years, they should perform and you will probably make you’re money back and then some.
Having said that, if the general market gets taken down again as it surely will, all miner’s big and small, high quality or poor quality are going to get taken out to the woodshed. It will likely be 2008 all over again.
Don’t think for a second that miners are going to disconnect from the general market and rally like all the guru’s and pundent’s try to convince people. They will not.
In closing, if you can hold on and ride the extreme volatility that is sure to come, you should eventually come out ahead. But I’ll admit, it’s hard as hell to stomach the ride at times.
Try to step away and not let emotion rule the day because if you bought good quality miners to start with, they are still good quality miner today. Good luck, I hope it works out.
Respectfully
V
it already is 2008 again! Most mining stocks are at all time lows right now or at least multi year lows. Anyone who thinks otherwise is just away with the fairies. 90% declines have been commonplace among mining stocks lately and the ‘best’ are probably down about 40%. Great sector, I mean seriously. All this hype and ra ra from the gold bugs and what does it accomplish? Nada. 95% of the gold companies are run by promoters whose sole purpose it is is to make themselves rich whilst making the public poor.
I’m done with gold stocks. Lost most of my life savings in them.
Never again.
The only investing i will ever do from now on is by Blue Chip stocks or the overall Indices such as Dow Jones, Nasdaq or maybe the TSX but even that is way too overweight in resource stocks.
I suspect the large-cap mining stocks have long expected a crash in PM prices. Why bother making aquisitions of the juniors and get stuck with a bunch of land that propably has PMs in questionable mining situations.
Bernanke says no QE3 at end of February and probably QE3 two weeks later after he deflated the mining sector. I think these guys have fun jerking the mining stocks around.
Dan
Dan,
Very good point about the large caps and what they may be anticipating.
V
HGD is an ETF for gold going down is starting to get overbought. Could be a sign of a bounce up for gold. Maybe the last before go away in May days. I have finally learned not to fall in love with a stock. Saved me a bundle on Scorpio today anyways.
Dan
Thank you, Vortex. That’s encouraging advice. With respect to the increasing volatility and a probable 2008 scenario happening later this year, what I’m thinking, considering your advice, is to just sell my miners at a loss during the next metals rally, and maybe, just maybe get back into some of the more quality miners after the market has crashed. But I’ll most certainly not go all-in.
Michael,
You are so correct about the hopium that has caught most everyone in this sector. Aside from mining a real and valuable resource this sector has everything going against it. Governments, permitting, bad jurisdiction’s, nationalization potential, high energy costs…..you name it.
Having said that, there is going to be some outstanding buying opportunities coming up later in the year when we get the inevitable deflationary scare. You should be able to reposition or re-buy some of the high quality miners and profit. But there is no panacea with these things. Forget the guru’s, they’ll take you to poor house.
But you have taken step one in regaining control over your emotions, forget the BS hopium just like you said. Forget all the crap being preached about buying and putting these things away.
I had to learn that lesson the hard way myself. Gold and silver miners are nothing more than trading stocks for the most part. There is nothing remotely buy and hold about these things…….they are way too manipulated.
Refocus and allow yourself to take profits along the way.
V
I’ve been saying for close to 2 months now that GOLD SILVER and the Miners are not going to move up much at all until after the elections>>>IF THEY EVER GO…Roger, John Embry, James turk and all these Gold bugs..keep talking about the Big Run Up and Better get in or you will miss it…OVER AND OVER AND OVER for about 7 years.
Miners are hot potatoes whenever you have some profit you take it becuase they go back down…ONE DAY there my be a mania stage…then again maybe not.
BUT Roger and the gain will continue to tell you to BUY BUY BUY and subscribe to their websites…their advice is not any better then anyone else. Now they are starting with their excuses of why things aren’t happening as they predicted…again…again again. Jerry Dan and Michael I agree with some of your comments.
I have noticed that there are less analysts commenting on the Kitco Silver page lately. A sign of confusion and fear of being blatantly wrong or bearish. I have no fear of shorting gold, silver and the PM stocks through the ETFs at the right time or going long if the opportunity presents itself. Ride the roller coaster or fly off a cliff like Wile E. Coyote.
Dan
Dan, basically what you are saying is you need to think for yourself and stop believeing every word some the socalled sector experts try to pronounce as fact.
You have the right idea, be ready to exploit the trend at a moment’s notice, either up or down.
V
Thanks Vortex.
mea culpa,
Dan
Reo,
I’ve stayed out of this thread. You guys need to air your views like anyone else. But I want to help show anyone I can where a weaknesses may lie, just as I’d expect that from others. Consider what you said in the above paragraph:
Miners are hot potatoes whenever you have some profit you take it becuase they go back down…
and
BUT Roger and the gain will continue to tell you to BUY BUY BUY…
This is completely wrong. Roger is not telling anyone to buy. He does exactly what your first statement says…he rides a stock up and sells at least enough once a gain is made to play for free. He has said many times that he holds spreads (which naturally hedge against falling values) 3 to 6 months out. So do many of those other responsible newsletter writers. Also, you could only be impatient with Roger if you’re listening to his ‘advice’. If you feel it’s wrong, and you’re a good investor, it should have a benign effect on your decision making.
What concerns me is, you didn’t see that. You assumed Roger told you to keep buying, and to hold.
You’re also confusing what he says about gold and gold mining stocks. You mentioned, Roger, John Embry, James turk and all these Gold bugs… You’re right…they are gold bugs, not gold mining company bugs. Which is it? Apart from the word “gold”, they are entirely different types of assets, with different timing and objectives (for example, capital appreciation versus hedging). You’ve attributed his words about bullion to equity stocks.
I think the counterpoints and complaints from yourself, Dan, Michael, Martin c are timely and worth listening to. There are people who pump mining companies. Who knows, it might actually permeate through to the boards of some companies that if Al’s listeners start to trash the industry, just who will be a buyer? It certainly gives me no satisfaction to see someone lose money or sleep in their investments, even if I disagree with their ultimate outlook. Remember though that the high-beta mining stocks which can make terrific gains in short spikes necessarily must also be volatile enough to make losses — even good companies that trade for less than book value or even the cash on their balance sheet.
DAMN STRAIGHT JOHN!!! Damn straight!
John W,…..Here that noise?
That’s me applauding in the background – after reading what you wrote…well done….well done…again
All the best,
Marc
Hi John W R,
That was a beautiful piece of writing and analysis. Absolutely spot on!!!
Again, this is one of the reasons I am here.
As always, much appreciated,
Best
Thanks John, overall I think we are all just trying to keep our heads together through stagnant times.
Dan
Reo,
Let me be clear, I was not talking about trader Rog. I think Rodger is trying to do good for all of us here. All he can do is give his opinion, and thats all he has done. We are all responsible for our investing actions.
There is some other gold/silver news letter writers that are not as honorable as Trader Rog. They have and will try to sell a pig in a poke.
V
Reo,
I dont really get you…..Are you trying to convince yourself of your negative bias by blogging here or are you just trying to vent with facts you have accumulated over the years – NOT months or days! Here is a fact for you: Over the last FIVE YEARS – I am up A LOT of money in my DOLLAR COST averaging the bullion…you either wine on a daily basis or get into the ONLY game left and hang on for the long run…but, hammering this market to all us here is not going to help you one bit…get and stay in…or get out and move on.
All the best,
Marc
BTW, I just reread my post and it sounds a little harsh…I am sorry for that…but, the PM market is becoming a huge geo-political and economic mind field of all sorts of converging factors When this finally, plays out G and S WILL BE the only thing standing…I have thousands of years of history to back up this NOT so glib comment. What basis do you establish your negativity on regarding the PM market?
Marc
Silver dipped just below $32. I have seen this as a sign before that the price will again drop below $32 and approach $31.50. If $31.50 is breached even by only 1 cent it will drop towards $31 and then see if it can hold there. There seems to be a 50 cent stair step that occurs and even a slight breach is a signal that silver will fall to the next support. Am I crazy or just watch this stuff too much?
Dan
Hey Marc,
I have been playing the miners for nearly 8 years and have made a lotas well…good for you…but what I am saying is you get in and you get out.The Gold stocks are hot potatoes…the thing that really bugs me is these SO CALLED experts with their websites and subscriptions always saying that you should buy and hold on…the big run up is coming…you don’t want to miss it…better to be in early (AND LOSE MONEY) or you might miss it..Then when there predictions don’t work out,…oh IT”S A Correction…great time to buy…this is the bottom…get in now…ON AND ON AND ON. Then I see and hear about lot’s of people losing money because they believe all the hype. The experts are no more expert then anyone else..That’s what I don’t like..I started buying silver at $6.25 and have been selling and rebuying for 8 years….I sold most of a 2000 oz inv in April 2010. The same with mining stocks…latest sell OK and SVL…they spiked up so I got out at a profit… and we are going into SELL IN MAY AND GO AWAY and then summer doldrums…the miners are going nowhere from here…Why am I frustrated..for a few months I started believing what the EXPERTS had to say and I tuned away from my strategy for awhile…I could have made even more profits….just giving my opinion and maybe others won’t make the same mistake.
Reo,
That comment is fair enough. I also applaud you on your success. Quite frankly, you are way ahead of me on both the market and you have more experience overall. I will continue to learn than do the best I can. I was under the wrong impression that you were a later participant to this sector and just were frustrated at the volatility. Again, good luck with your future endeavours and thanks for your response. Additionally, with the bullion, I am a long term hold guy until the MACRO fundamentals start changing and quickly – I just dont think so. We either 1. default..extremely unlikely…2. reboot the financial system as a country….nope…way too dicey..3. inflate the currency down to “nothin”. Probably that’s goin to happin..all roads lead to this PROBABLE outcome….
Finally,I just read this on the internet last nite. ANOTHER SCENARIO…All the people that have PM holdings will be asked to VOLUNTARILY dispense their loot to the government for EXTREMELY high returns…i.e. $50,000 an oz gold AND 5,000 OZ SILVER. That way a very small portion of the market holding the metals cashes in, the government centralizes the “true wealth” back to their control and the monetary anchor is reestablished. The few get a tidy profit,( What those dollars mean – I have no clue) unrest in somewhat maintained, and the system reboots to a more Austrian view of economic stabilization. LUDICROUS maybe…but who in the H____knows…I certainly don’t.
All the best,
Marc
Interesting exchange. Thanks Marc and Reo.
Re: ANOTHER SCENARIO… Ultimately we are all sinners and we are just negotiating the price. I would take a large payment for most my silver but not the “junk” or “scrap”. That would be too handy for a doomsday scenario.
Dan
Hey Dan,
Thanks for your input….interesting to keep your junk silver…hey, might the RIGHT call!
All the best,
Marc
I remember last fall when trader Rog stated gold was going up over $2000 and my charts were telling me that we had seen the high for a long time. I posted that and continued to post that the precious metals would trade sideways to down for weeks to months. That’s happened and the trend will continue for awhile. Another thing that could exacerbate the issue would be a general sell-off of the conventional markets which is coming due sooner then late. As mentioned before, I’m short oil, materials, and the general market. I continue to cost average in. Commodities are breaking down and from my viewpoint portends a deflationary bias at this time. The Bernank will probably verbalize increasingly a need for QE3 and he’ll probably push the issue in April at the next FOMC meeting. This recovery is weak inspite of the hype. China and Europe are weakening more then the “experts” think and we’ll be unable to decouple from global weakening. Mining shares will continue to work lower for weeks and the precious metals will also move lower. HOWEVER, the bull market in precious metals is NOT over. If you look back in the 70s in the last great precious metal bullmarket there was a 40% pullback prior to the parabolic move later. However, this time we’ll be in this bull market for years since our circumstance is so much worse then the 70s. There’ll be a point again when the precious metal stocks and the metal will be a good buy and it’ll be in the next few months.
Richard,
You could be right on.
Marc
UNBELIEVABLE!!! I posted last Thursday (March 22nd) that I felt the bottom was in based on technicals and SENTIMENT. Well, today I am ALL THE MORE BULLISH with the exchange going on. I also bought on that same day, deep in the money call options for June on some high beta miners and WOW; great timing that one was. I’m still holding. Why? Because often the high beta miners LEAD the metals.
But these are based on my own decisions and not others. And these are based on WHAT I HAVE LEARNED LISTENING TO PEOPLE WHO COME ON THIS PROGRAM REGULARLY AND SPEAK.
I am amazed at the number of comments regarding mining CEOs as “greedy bastards” or “the large mining stocks have long expected a crash”….HUH??? THIS MAKES ABSOLUTELY NO SENSE. I’m calling a spade a spade here and now.
You gentlemen invested in this sector because of the allure of riches that all the promotions have been talking about, and the WELL KNOWN MILLIONAIRES who have been made from this sector! PLEASE DON’T WRITE ABOUT CEO’s BEING GREEDY BASTARDS. This is a classic case of the pot calling the kettle black!
It also shows that some people DON’T PAY ATTENTION TO THE INTERVIEWS performed on this site. A mining stock that drops 25% based on low volume sells is a classic sign of a bottom!!! GO LISTEN TO WHAT PETER GRANDICH SAID LAST WEEK!!! See what John Embry says as well, or Jim Sinclair.
And regarding the articles being posted about “where gold is heading” oh MY GOSH!!! Did anyone stop to look at who the author was on those articles? It’s the same people who have been bashing gold from $250 an ounce all the way to $1900! And SURPRISE! SURPRISE! SURPRISE! Goldman Sucks recommended gold to clients today as THE GOLD MARKET WAS FALLING ON HIGH VOLUME. Wow! I wonder how that just happened to have come about? Gosh! The little mysteries of the world.
Okay, so I show a lot of sarcasm in my words, for this I apologize. But gentlemen, PLEASE. If you want to take out your frustrations then do it somewhere else because Big Al and Rog haven’t TOLD YOU what to do with your money…YOU made that decision. And as I have posted on here BEFORE, I am as guilty of making the same mistakes as some of you gentlemen, but I realized that I WAS THE ONE TRULY RESPONSIBLE AND STOPPED BLAMING OTHER PEOPLE.
Sorry to hear about your losses, but you HAVE TO ADAPT to the changes! We have to survive somehow and that means you have to be willing to change your investing ideas and trading ideas.
Take care.
Another thing: Mining stocks have completely different categories as well! Large producers, Junior producers, and explorers. THEY DON’T ALWAYS MOVE IN THE SAME DIRECTION AT THE SAME TIME. Explorers should be bought by those who ARE WILLING TO LOSE EVERYTHING THEY PUT INTO THE STOCK. You should not put more than 5% to 7% of your principal into explorers – PERIOD! But it sounds like there are those who have put too much into them and that is sad to hear. I LEARNED THIS THE HARD WAY MYSELF but I also learned that you HAVE TO TRADE IN AND OUT OF THEM when you have profits.
If the large-caps don’t think the price of gold is going to drop then why aren’t they buying the small-caps up?
Some small-caps went down recently on huge volume. Not huge for the overall market but huge for the individual stock.
Dan
Large caps are looking for quality. They are looking for high grades, low cost producers. There is an EXCELLENT article about this subject over at mineweb.com and it is done with interviews from Gold Corp and Barrick. Just because you have a “small cap” doesn’t make you a prospective take-over. Large companies want definitive ounces, grades, PEAs, etc. Oh sure, there are a lot of junior explorers who have drilled some gold and silver but the overall current market conditions don’t warrant a buyout. Even small producers are going to find a lack of takeover solicitors. Go read the article it is very interesting.
Thanks Mark, I will take a look. If they look for quality too long they will be bidding on the crap left over.
Dan
And this is the whole problem, Dan! Trying to find quality! It’s like Brent Cook and Mickey Fulp both say, high grade, high percentage ore extraction, VERY positive PEAs, jurisdictions, etc. And like they both said: “For every 100 companies out there, there are maybe 10 companies with “something” but only 1 with a real mine”.
So, be VERY CHOSEY with your miners! I mostly trade them and I don’t own any for holding.
gold stocks are going a lot lower. the people that promote the fairy tales of manias for years and years are worthy to be mocked. ( not accused, because of 100 % personal responsibility ) , but mocked non-stop.
Good Comment Dan,
It’s the years and years that drive me crazy…They keep saying ANYDAY,, next month etc etc. Hey Richard, Roger’s Gold call for over 2000 an oz has been going for nearly a year. It’s always JUST AROUND THE CORNER. He doesn’t know when…has an idea that maybe probably…but everything has gone up in price so yes GOLD wil one day be $2000. Doesn’t take an expert to figure that out.
RIGHT ON JIM..I agree with you..especially the guys that have a website and want you to subscribe to their newsletter…THAT”S their gold mine.
TIRED OF THE HYPE
Hello Reo and Jim
I agree whole heartedly! The cheerleaders, hype, instant wealth fantasies really lost me a lot of money. I got sick of hearing every year that “the mania is just around the corner” and I heard it now for well over six years. Worthy of being mock? Well, I would have to say I agree with you on that one. However, there are cautious investors out there who have been very calm and relaxed about their approach to gold, and very realistic. I simply have unplugged myself from all the noise – both negative and positive – and focus only on what I find and I go with it.
Thanks for your comments
But with that said, I still can find great trades in the miners and that is how I have had to try and recoup all my losses – trading in and out. Buying and holding doesn’t work and it didn’t work on Wall Street either. You can make money going up as well as down.
I agree with many of you guys, the juniors have been crap and the ones I hold I have lost money. But I came across this website(TheStockFox) the middle of last year and have made considerable gains trading their GDX System. For those interested
http://thestockfox.com/automated-systems/gdx-automated-system.html
Roger, I’m sad to hear in your voice what sounds like disappointment in the miners, and lack of optimism regarding their future performance. My portfolio of miners is down almost 30% since it reached break-even level in February. Hearing your market trends today gave me a bit of despair for the miners. I’m at a point of wondering if I should cash out of them at a loss, and buy physical gold or silver instead.
How long could it be before the HUI gets back to 550, or the XAU to even just 200?