A bit of a change in Big Al’s philosophy. Not dramatic, but it is there.
Click download link to listen on this device: Download Show
Scorpio does make available an interesting entry point here.
That is unfortunate for the shares already held.
But taking profit as you did now allows you to add # of shares , go elsewhere or both.
In order to but low and sell high….you have to sell.
Good for you Dan!!!!!!!!
Hey, I got one good trade in a row! Nothing is easy so I don’t suspect it is going anywhere fast for now anyways. I am starting in on uranium juniors now. Out of the fire in to the frying pan!
Dan
I am still not convinced that uranium juniors is a particularly great place to be right now.
Big Al
Thanks, I’ll keep that in mind.
Dan
HI Dennis,
I am still waiting to talk with the folks at Scorpio.
Be great if you could facilitate that.
Big Al
HI Dan,
I have to agree with Doug at this point.
Best,
Big Al
Big Al,
I think that is wise. I am doing likewise. The crux of comments yesterday centered around not so much being MORE aggressive now, but in presuming people were bailing out when the macro environment hasn’t changed – that’s all. I haven’t diverted any funds away from diversification into the natural resource sector. Matter of fact, I haven’t made a trade in two weeks. The bottom line is that I, too, am in a wait and see mode. I have two paper investments that include leverage plays with the “paper” metals”. I am waiting to break even there, and then redeploy into the explorer/micro juniors when opportunity arises and my research and DD warrants it.
All the best,
Marc
You know where I stand, Marc
bless
BTW,
I think this is very important to reinterate. IF, I had more available funds to accumulate more physical metals to my portfolio, I would NOW. I really do think we are at a bottom. For better or worse, that is what my info and gut are telling me. Although, not a prolific trader like most of you – I consider myself a pretty damn good accumulator – with that said – I have looked at the last of my EE bonds(eventually worthless paper) with great intensity – but, I have already reached the point in January 2012 of my tax limit – therefore, I will hold off simply for tax reasons…FOOLISH maybe, but, I am at heart a plodder, not a sprinter
Marc
HI again Marc,
Much better to be a plodder than a sprinter.
You know the old story about the tortoise and the hare.
Big Al the tortoise
Hi Marc,
I agree with your strategy of being an accumulator, buying at perceived bottoms, and being a plodder. As Big Al alluded to above, the turtle gets it done. Consistancy is better than flamboyant bursts of speed.
I am a plodder as well. Best to you.
HI Marc,
All I can say about the juniors is that there are always some great buys out there. One does need to exercise caution at this point.
Best,
Big Al
Hello Big Al,
Agreed sir. Caution is always in order.
Thanks.
Al:
I’m in for the long term on RPM. Just too many good things going on and I don’t want to miss any of it on the sidelines trying to time an entry point. That said I would add more if it goes below $.50. Might nibble at OOO if it hits $.15 and FCO again under $.40. Gold prices will remain strong as the USD$ continues to weaken. Just my thoughts.
Tony
I agree with you regarding rpm and ooo and, as you know, I have put my money where my mouth is.
Best to you Tony,
Big Al
If this is the most uncertain, or even fearful, you’ve felt in the last 6 months, it’s probably a good time to buy. The hallmark of the biggest moves higher has consistently been surprise. Not only is a fledgling big move met with disbelief, but they also tend to shake even more people out early in the rise as they sell strength too aggressively. The longer and more trying a correction is, the more bullish we should become. Our own conviction and understanding is the key to acting appropriately.
The big view gives the best perspective. Short term price anomalies should be ignored unless acted upon professionally. The time to sell a well chosen junior is when something changes materially for that company, or you’ve made the type of gain that demands profit taking. Most people will only lose if they attempt to go in and out of these illiquid gold “call options.” The seniors are a different story.
Evening Matthew,
Good points, my friend.
Big Al
Excellent Matthew, as always.
Appreciated.
My turn I guess.
I was watching that right shoulder around the beginning of the year too. I also watch the popularity of the mining industry as a whole with a couple of different measures. Short version, I don’t think we’re quite at a bottom yet either.
Consider what happens if you sell a stocks now:
* You’re possibly leaving value-investing and entering into market timing, if indeed you even had a system in the first place. Most of us aren’t born disciplined enough to follow a solid strategy, me included. If you are going to market time though, understand that’s exactly what you’re attempting.
* As Matthew noted, and I’m sure you’ve all seen statistics like this, most of the gains in a given stock or given sector occur in several brief spikes. Investors Business Daily, for example, usually does an article on this every 6 months, where they’ll note that if you missed the 5 best “up” days in a stock over the last 3 years, you lose 80% of the compounded upside, etc. That’s a general figure to make a point here, but not too far from the real thing. You gotta pay to play. Ooops, sorry, thinking Mega Millions there. More like, you gotta stay-into win.
* Consider transactions costs like short term capital gains and brokerage fees if you’re going to trade in and out because of an upcoming consolidation. You also have to consider potential opportunity cost if a stock you trade out of goes up, not just your expectation of it going down. You can weigh this risk/reward ratio with simple math. The formula changes depending on your investment system, of course.
* If you know technicals, which have largely become self-fulfulling propositions as chart thresholds are programmed into computer-based algorithms, I believe it is possible to make much better exit and entry points. It’s very hard to trade based on fundamental numbers alone.
* If one ever needed a contrarian indicator, it just might be with Al and his fellow bloggers have turned negative on the industry. I get a little weary with all the people who fancy themselves contrarians, but this might be qualifying situation. There’s several good companies still selling for much less than book value right now, and no one wants them. Hmmm.
That’s pretty general advice, so I’m sorry if it isn’t sparkling with new ideas. I could also probably write a list of how unprofitable it is to be stubborn to hold onto non-performing stocks, and to be too bullish on an industry which the rest of the market doesn’t care about. The bottom line, however, is there are several ridiculously undervalued companies who make a product that is at it’s highest valuation in 30 years. That’s an unusual fundamental which always rights itself.
As Scott Hamilton says after every post, Best to All!
Concentrate trading positions in qualified accounts especially a Roth (if you converted to one an/or are qualified to have one…most here probably do not qualify). This helps with John’s transactions costs. As far as qualified plans do not lie to yourself that number on the statement is not your money. You have a partner in that business.
Do not over utilize stop orders. You are setting up bear raids. When taking profits for obvious reasons stops are not the ideal way to do it. Sometimes you need to pull the trigger during a run. Jesse Livermore was never afraid to leave 10% on either side of a trade on the table. My favorite quote of his “The point is not so much to buy as cheap as possible or go short at top price, but to buy or sell at the right time.”
Is is nice to score a touchdown but most football games are won at the line of scrimmage between the twenties.
Morning Dennis,
For what it is worth, I am doing the majority of my trading in our Defined Benefit Plan.
Big Al
Hi Dennis,
Wish I knew half of what guys like you, Matthew, John W R, and others here know about analysis, chart reading, investing in general. Appreciate all that you put out on this blog, even if a lot of it is over my head. It makes me go study and learn.
Thanks much.
HI John W,
I heartily agree that there are some great buys out there. That is why I recently purchased Canasil and Otis via a private placement. I also announced on the Weekend Show that I will be buying Clifton Star in three days.
Your points, as always, are valid.
Big Al
Hello John,
Darned good writing, sir. I appreciate your points and perspectives. That is very helpful information!!
Best to you.
Hi Al,
Since we are somewhat close to the summer sell off, I am waiting for some real bargains in the stocks. That said, I have continued to accumulate physical but have been buying more of the 90% coins because of the low premiums.
HI Karen,
I am actually considering buying some coins. Never thought I would say that, but I recently looked at the small collection that my folks left me and I must say that it does give one a bit of a feeling of security.
Big Al
Al, you’re right to be cautious. I follow a ton of charts and there is one that I put a large amount of credence in. It’s right up against that resistance and if it would start to break over it, I would have to become much more bullish on both the conventional markets and PMs. However, there are gaps to the downside that need to be filled and based on that the path of least resistance is down on that particular chart. All my other charts are showing a breakdown in commodities and that includes oil. I’ve been short oil, commodities, China stock market and our conventional markets. The Chicago PMI reported this morning is another “shot across the bow.” I believe Apple is getting ready to implode (finally). If that goes, you can say good-by to the S&P and the NASDAQ. One has to remember also that the PM stocks lead the metals both up and down. We all know what has happened to the GDX and the GDXJ. I’ve been shorting multiple markets for the last 4 weeks incrementally and will continue to. The only caveat in my mind that may prove me wrong is that we’re in a “secular bull market” for the convential markets. I was eating at the time and had to clean up the mess after he made the point (where in the world do these guys come from?). We’re in a secular bear market and a current cyclical bull market which won’t last (again). He made his point based on the low yields of bonds and how the stock markets historically do well in that environment. What he missed is that historically you didn’t have the Fed printing money to keep yields low and that you can throw out most historical data since we don’t have efficient markets currently.
Hi Richard,
Why do you think Apple will implode?? They have 97 billion in cash and a great product line
Karen, I’m first a technician and then a fundamentalist. The Apple chart appears to be ready to deteriorate. We could “back and fill” a little at the top for a couple of weeks but I don’t like what I’m seeing on the daily chart “relative strength indicator” and the “MACD” indicator. They both are starting to show some loss of momentum. However, the weekly momentum indicators are not showing that yet. That’s why I mentioned Apple could hang around at these levels yet for awhile but I don’t believe it’ll be a straight line up, especially if the rest of the market is “tiring”. If Apple’s price starts to deteriorate from here it should be a gradually topping pattern. I also listened to a guy recently that broke down how much they would have to sell to reach all the prices the analysts are predicting. It would mean that just about every man, woman and child in the world would have to be buying their products on a regular basis. The numbers didn’t add up. Most of the analysts don’t delve into the numbers like this guy did. Great company—absolutely; overpriced at these levels at this point in time; most likely. I might add that if you believe that gaps in charts have to be ultimately filled technically, Apple has a rather significant one at a price of $425.00. I might add that executives (insiders) have sold significant number of shares just this week.
Hi Richard,
Thanks!!!
Your last sentence, Richard, is what really concerns me.
Big Al
If I was in charge of Apple and the company had 97 billion in cash I would take 75 billion and buy mostly gold bullion and open an account with James Turk’s Gold Money . com. I don’t know where and how their money is invested but it could be at great risk if it is sitting in US treasuries, just because you know how to make money doesn’t mean you know how to keep it.
The only caveat in my mind that may prove me wrong is that we’re in a “secular bull market” for the convential markets. A fellow from CNBC business made that point.I was eating at the time and had to clean up the mess after he made the point (where in the world do these guys come from?).—addendum.
What!?
To clarify, MSNBC, I stopped listening to…much more informative and realistic on selected sites in this venue.
All the best,
Marc
CNBC…I mean…sorry
No matter Marc. They’re all the same.
Me too, you guys!
Big Al
I recently sold some gold juniors and have been playing graphite stocks that are outperforming the market because they are in flavor much like potash stocks were 6 years ago when the ferts were on fire. It’s still a matter of backing the right horse but at this stage if you go with the analyst’s picks and then do your DD it can be rewarding. One stock I have was a recommend from M. Fulp and then J Dines apparently gave it a thumbs up as well. But this approach is hard for people who do not see “The Market” as 1000% gambling no matter how sold you are on your past picks.
Sorry to say, but I think that the graphite sector is just in vogue right now. I am sticking with gold, silver and energy.
Big Al
Al: The HUI is now at levels when gold was about 1200 in mid 2010. The sentiment levels are extremely bearish for gold and especially for gold stocks.
According to Don Coxe, who has different take on gold, the gold run up last summer was the result of Euro-land fear and we saw gold go up when euro fell.
“If conventional stocks form the asset class of Greed, then gold is the asset class of Fear—fear of infation, and/or fear of system breakdown.”
Fear of Euro breakdown switched when Mario Draghi took over at the ECB. Don’s theory was that the run to gold last year was part of a run to safety and away from Euro. When the money printers opened the spigot for faster ink, the Euro began to stabilize even when it was falling. This provided liquidity to the banks which leveraged gold down, but more importantly gold was not seen as a flight to safety for fear of the Euro collapse.
Don now thinks however that because of the massive money printing being ratcheted up by all central printing banks, that a fear of inflation will ensue which will prop gold back up and send it to levels compensatory to world wide money printing if for no other reason than to prevent debt burden collapse.
http://www.scribd.com/doc/86292497/Basic-Points-March-16-2012
You can also listen to Don on his Friday talking points through links which I would be happy to give.
Clay, I generally agree with Don’s assessment but feel we’re still a long ways away from the inflation scenario. If we’re currently moving back into a deflation mode, it’ll take time before inflation impacts gold. Currently, I feel gold is a “safe haven” play from deteriorating sovereign governments , their debts and their currencies. Will we ultimately see the inflation boost; absolutely, but I feel it’s months away.
richard: Don’s theory certainly appears to have some validity. I am not entirely sold however unless most believe the government reported inflation numbers. I find that hard to believe, but the market can stay irrational for extended periods. But considering the fact that gold has not really been down that much on a medium term basis and mostly up long term, whereas miners usually show higher beta than their product, actual physical bullion does not trade hands that much while the stocks do.
Don has always believed gold to be a play on both Safe Haven and Inflation, and there is certainly support for this view.
Nevertheless, it always amazes me how many people ignore the debts in these countries thinking that either someone else will pay or that it will be plugged by printing. That is why it never gets fixed, only kicked down the road as it gets bigger and badder. So in reality Safe Haven and Inflation hedge are really the same thing, and only in the medium to short term does irrationality reign.
I like your comment, “and only in the medium to short term does irrationality reign”.
So true!
Big Al
RIchard,
No question that gold is largely safe haven. Have you ever seen a chart with the price of gold, marked with the beginning/end of QE1 and 2 though? I think the ‘other half’ of the equation is fear of inflation. I wasn’t entirely sure about this correlation, since QE was a US tactic, and gold is an international commodity. But the correlation between the two is striking.
John, that’s correct—a lot of commodities look deflationary here. You can bet that if the conventional markets tip over here and the job market starts to weaken again (good possibility) then you can bet that the Bernank will start to talk about QE3 sooner then anticipated. Then you’ll see the PMs stabilize and even start to move up again.
What choice does Dr. Bernanke have other than QE3? That is really the question.
Big Al
We all have to remember that if you ask a group of people what is the point of investing in gold, 90% will say because it is a great hedge against inflation.
I personally look at it being much more than that.
Big Al
Evening Richard,
At the risk of being simplistic, I also view gold as being a super safe haven play.
Big Al
Sure, please provide the links.
Big Al
I think we are almost definitely at or near a major LOW in the metals and mining sector, both for the commodity prices themselves and for the stocks. When even the most ardent Gold followers and commentators are are starting to turn bearish, then you have the ULTIMATE BUY SIGNAL.
I’ve seen several charts that show the gold stocks now at the cheapest they’ve been in this ENTIRE Gold Bull market!
With bearishness so prevelant, you really dont have that many more people left in this market that can be sellers – this is what major bottoms are created from.
I fully expect to see gold move up from here – and very quickly – to the $1850 level and as it does, the gold stocks will rebound nicely. But its the next leg up from there, when gold breaks out above $2,000 that will take the Juniors up with it and up in a big way – thats when the public will be scrambling to get into these stocks and you’ll see them climb 100%, 200% or more in very short order.
When I feel things are hopeless and my stocks only seem to go down – thats the exact time when i should be buying. Its a tough thing to do because your instinct is to sell because you’re nervous that things might get ‘even worse’ but if you take a step back and look at long term charts and sentiment indicators, we’re right in the BUY zone right now. And when things improve and you look back and wonder why on earth you didnt buy these stocks when they were low, it will be very hard to get in without chasing the stocks much much higher. The same cycle repeats every time, its just not easy to recognise it when one is heavily invested.
Good luck to everyone and have a great weekend.
Intriguing comments..thanks!
Marc
Alan, That’s absolutely correct providing it is actually people who do the buying and selling. In this insane Keynesian world I am not so sure, it could be central banks that do all the buying and selling naked or not and they have infinite pockets. In either case, liquidity is what keeping it going which sooner or later comes back as inflation with compounded interest.
Alan, I’d have to agree with everything you’ve said. It’s little comfort for those who bought a year ago. I’d still encourage people to only buy the very best companies, many of which are discussed regularly here. The only way gold mining stocks won’t go up is if gold somehow crashes in value. There is a shorter-term correlation between the gold mining industry and regular markets, but it’s neither permanent nor directly coupled.
Greetings Alan!
You’re talking my language! I don’t know if $1850 will be soon, like three weeks, but I think we may see it by mid May. We of course will have another hard fight to knock gold down to $1745$1760 once we hit $1800, but I think when it hits $1800 again it will cut through it like a hot knife through butter and then $1900 will be like a magnet. I know I probably sound like one of those “Perma Bulls” and I don’t want to sound that way. I just think from a fundamental and technical way, things look really great for the PMs. After they hit that $2000 the juniors and producers will really follow but AGAIN, there will be a little fear about buying into them because MSM will be touting the ever “gold is in a bubble”…choose wisely.
Mark,
You could be exactly right! Thanks for your insight.
Marc
Evening Alan in Vancouver,
Prudence is still the key.
I remember back in the early 80’s when you could not give a resource stock away. A number of good friends of mine ended up in serious financial straights because they thought the entire market would explode in an upward direction by the next day. There were some great buys out there that turned into great profits. Those profits were only realized by those who were very careful and diligently followed fundamental investment techniques.
Big Al
Back with you all in the morning.
Hard day of wine tasting!
Kind of just kidding, I used prudence today as I do in my investing.
Best to all!
Big Al
You should remember that even “The Bluest Of Blue” stocks can go bankrupt look at General Motors and Nortel just to name a few and now we have “RIM” looking very speculative and maybe “Apple will join the fray ,we just don’t know. The stock graveyard is full of high fliers who were big names in the past and are now only memories because like the dinosaurs nothings stays the same for very long and that is more true of the investment world. Without bailouts most of the too big too fail banks would be gone only they got a reprieve only to bite the dust in the future. My point is this if you want to make money in the markets sell when you see a profit I typically use 20% as a guideline.
I would like to again, point out, on the metals – the longer we stay on this base range and build it (.i.e. the number of consecutive trading days hovering around – 1650,1660 -G and 32.00, 32.50 – S, the bigger, and stronger the base becomes, the bigger and stronger the base is – the bigger and stronger the explosion of the upward trend will be…, in my humble opinion.
All the best,
Marc
Marc, I agree entirely. Unfortunately, I believe we’ll trade sideways to down yet for a number of weeks to months. It’ll allow the 200 week MA to continue to move up and then when no-one is much interested, the PMs will take off again. Just remember; in the PM bull market of the 70s, there was a correction of about 40% before the PMs took off for their parabolic move. However, I think this bull market will last longer since we have a different set of circumstances such as massive global debt that has to be dealt with.
Hello Mark and Richard
I think I am going to stick with my stance about gold moving towards it’s upward range rather soon. I truly believe that the way the U.S. dollar has been acting and with the stupid, idiotic move our government did using the SWIFT system to corner Iran and threaten other countries….I just feel that the PMs may disconnect at this point. But I definitely agree with Richard about the general markets! The Transportation and shipping sectors are not performing like the other indices.
Sorry, Marc …not Mark
That’s what I LOVE about Big Al’s site- respectful, intelligent people getting together and discussing somewhat converging points of view in an, otherwise, larger macro-bull picture! Love it –
Thanks, guys
All the best,
Marc
Morning Marc,
Great point!
Big Al
Morning Shawn,
I think that as far as using that criteria in the resource sector, you may set your sights a little low.
Big Al
I have bullion, juniors, mid-tiers and seniors. I have made very few changes in the past year except to get rid of a few stinkers. My view is this: If the company has proven resource, proven management, and in the case of juniors, infrastructure and 43-101 proven resource, then it is just a waiting game. Gold will go to unimaginable numbers and take the stocks right with it. It happened in the 1930s. It happened in the 1970s. And there is no evidence that human nature has changed. The only big difference is that Asia is a big player. With 40% of the world’s population, this will only stoke the fires of demand and upward surge of precious metals. Print these words and put them on your wall. It is inevitable.
JED,
I AM SORRY FOR THE CAPITALS, BUT IN MY HUMBLE OPINION – I THINK, JED, YOU SUMMED IT UP PRETTY DAMN WELL – OH WELL WE DONT NEED THE BLOG ANYMORE – HAAA!!
All the best,
Marc
PS I am going to print this and pin it up on my DAMN wall!!
A big Amen, Jed!
Big Al
Guys,
Don’t you think the three headed beast of Gold, Silver, and Oil over the near to long term prospects is the best place to be? If war breaks out in the middle east, I don’t think I want to be anywhere else. We know the Fed has to keep printing, as does the EU. Real, painful austerity will not happen. Debt will not be paid back. Worldwide default is likely within the next 2-5 years.
I do think that the PM stock payoff risk reward is questionable. Quality PM stocks
no problem, but betting large sums into the junior sector, knowing that 90-95% will fail is crazy. Odds in Vegas are twice as great as that.
Hold onto your physical gold, silver, and oil with a death grip! We’ll all be more than just fine!
PAGE “II” is opening soon too.
Yep, John W…yep…absolutely its coming and maybe more competing exchanges to follow for the expansive Pan Asian markeplace. BTW, does the average Westerner have any idea how many people are coming “on-line” as these years progress?..short answer; No..no way!
Good Evening David!
You have to remember “austerity” can come in any form. When you use austerity as you did, it implies that the government is going to do something. Right now, Americans HAVE A FORM of forced austerity. We are losing purchasing power by the day, salaries are being cut, hours worked are being reduced, benefits decreased dramatically. We American workers ALREADY HAVE austerity in place, it will be just a matter of time before a governmental enforced austerity takes place. But even gold, silver, and oil can have their days…JUST LOOK WHAT HAPPENED OVER THE LAST EIGHT MONTHS..WOW! Buying physical on dips, buying great miners on dips using a dollar cost average, buying energy companies on dips as well….but don’t be afraid to take those profits when they happen. Speaking of profits, had a nice one with my ANV call options i got last Thursday, took the principal and letting the profit ride.
Mr. Alan,
As always, you make some really valid points!
Big Al
Let me stress again, I only invest in what, I believe, are very solid juniors. And, I start with management.
Big Al
If you look closely at the events in Greece, it looks rather likely that their May elections will throw their bailout into confusion. I suspect that this will be good for PM’s (until the next bankster smash comes).
Everyone is already assuming that Greece will get yet another bailout. I wouldn’t worry about them, they’ve been in default for half the modern nation’s existence. It was a mistake to let them in the EU. Yet more irrational exuberance of the last decade is to blame.
Why does Greece have an election anymore?
The votes that matter are all 3 to 0.
It is called the Troika making a decision.
Watch this video again he is the Winston Churchill of our day calling evil what it is…
articulate bravery:
http://www.youtube.com/watch?v=2gm9q8uabTs
NOW THIS is interesting. Enjoy everyone!
http://www.youtube.com/watch?v=ll-9un7IIfw&list=UUThv5tYUVaG4ZPA3p6EXZbQ&index=1&feature=plcp
Mark
Thanks…Enjoyed it very much.
Very, very interesting!
Marc
I love it!
I may move to SC…..I will help them build a vault.
My favorite pull quote….:
PULL QUOTE “evidence says it (gold and silver) is more stable than the dollar”
I know this is not news to the reader here….but think about who wrote it and realize the ramifications.
If physical gold available for investment is akin by volume to a large olympic pool and if Silver available for investment is akin to a baby pool….then picture this…all those
State pension funds taking the plunge……WARNING THE BELOW LINK IS 1/2 HR LONG!!!
if you start it you will have to finish watching it. Think of the splashing water as silver going up in price as Johnny come lately gets wet
http://www.youtube.com/watch?v=L5-yev7I4UY&feature=related
South Carolina is on the ball! Almost?
Hi Dennis and Mark Alan,
Thanks for the links. Since we’re focusing on SC and the possibility of using gold and silver coinage again, I have a question for you astute analysts. There are two junior mining companies in the SC area, developing a resource in the Carolina Slate belt. Romarco Minerals and Revolution Resources. I have studied Romarco and they have a measured and indicated resource of 4.0m oz. It is open pitable with high grade averaging 2 g/t. They have the old Haile mine in Kershaw, SC, that predated the early California gold rush. The main issue I see with them is they have a bloated share structure with approx. 600m shares fully diluted, so I’m guessing they are going to have to do severe rollback at some point. Just wondering if anyone else has any thoughts on Romarco or Revolution?
Hello Castanheiro!
A little over three years ago, I was seriously considering Romarco Minerals as a long term investment. When share prices shot up over 400% from where I was considering them, I was very disgusted with myself. So, naturally, I decided to consider them again early last year. Well, after seeing how they not only diluted the share price to oblivion, there was also a lot of environmental resistance coming from certain groups, as WELL AS some resistance in their state government. I don’t really like the story because I still see FURTHER dilution coming down the road. I also DON’T LIKE the number of warrants issued. I also don’t like how they obtain their financing. I also don’t like the lack of institutional interest. I also don’t like their advertising method. I also don’t like the measured and indicated resource estimate because I would rather see a PROVEN & PROBABLE estimate at SUCH LOW GRADES! To me (and this is just my opinion), Romarco would not be too interesting UNLESS gold were trading near $2300 an ounce and the world was DEMANDING more gold as soon as possible. Just my opinion.
take care
Hi Mark Alan,
Thanks for responding. You and Dennis’ points of view are exactly what I was looking for. I have only been in the junior mining sector for about 3 years and still have much to learn. Just looking at their website, from a Feb.22, 2011, NI-43-101, they have, “•Proven and Probable gold reserve of 30.5 million tonnes at 2.06 g/t for 2.0 million ounces” and “Measured and Indicated gold resource of 71.2 million tonnes at 1.77 g/t for 4.0 million ounces”. I used the term ‘high grade’ because they called it high grade. I’m guessing that it’s pretty good grade when you’re talking open pit. For something deeper requiring a shaft mine, I’m assuming that 2 g/t would not be considered high grade, but again I am learning all this stuff.
This from their 2010 annual report, “The Bankable Feasibility Study results were announced in February 2011. The Feasibility Study was completed using a gold
price of $950 and demonstrated robust project economics. The
Haile Gold Mine will be one of the lowest capital cost, lowest
cash operating cost, and highest-grade open pit gold mines in the
industry. Couple that with a politically stable and mining friendly
South Carolina and well established infrastructure and Romarco
is in an enviable position amongst our peers. Details of the
feasibility study are presented in the annual report”.
Appreciate your opinions. I haven’t invested in them because of the extreme dilution. Thanks.
Good Afternoon Castanherio!
As a former series 65 and 63 license holder, I can no longer give financial advice…sorry. However, with that being said:
Look VERY CAREFULLY at what you placed from the website. It is all OLD NEWS as far as planned drilling. 2011 is over. I WANT TO KNOW WHAT THEY ARE PLANNING FOR 2012 and BEYOND.
How much cash do they have in the bank?
What was there Internal Rate of Return post tax and expense?
Why did they only calculate using a conservative $950 per ounce, and if they did use higher values, then what do the figures suggest?
How do the local farmers, ranchers, and community feel about the prospect of the mine? (not relying on what Romarco’s website says)
Will they actually build the mine, or do they want to be taken over by a producer?
Did you GOOGLE MAP the area where the Haile Mine is located to see just EXACTLY HOW GOOD the infrastructure is?
Did you call the Chamber of Commerce for the City of Kershaw and speak to them directly? Have called the State of South Carolina and spoken to anyone there regarding what type of current mines are in operation within the state and how does South Carolina view the mining industry overall? Have you asked for a copy of the State statutes that protect and support the mining industry?
Have you read the companies 10K reports, or any documents filed for the company through http://www.sedar.com, especially the management reports?
How much CASH DO THEY HAVE IN THE BANK AS OF MARCH 31ST, 2012?
How much stock is owned by the company executives (www.sedi.ca)?
How many options have been granted to employees and how many have been exercised?
When are the warrant dates, and how many are due and at what price are they exerciseable, or when do they expire?
Any institutional selling or purchasing and in what quantities and frequencies?
Who is or are the main banking institutions who help provide the financing?
Are they broker financed, or non-broker deal financed and how often have they sought financing?
What research companies have covered the company and have you called any of them to discuss their findings?
That is where I would BEGIN
take care
Hi Mark,
I should have placed a caveat on the news I put out. I knew it was old, but I was trying to get out quickly, what I had found from their website, as I was rushed going to an evening engagement. I am NOT an expert in any way, shape, or form with regard to mining companies. My hope was, that someone with greater knowledge and experience, might have a better understanding about the company. I’m certainly not trying to make a case for or against them, and neither have I taken a position with them. You certainly ask some very good questions that honesty, I do not have answers for. Was just wondering if anyone else had checked them out. Thanks for your excellent response. Best
Castan I love your posts!!!!!!!!!!!!!!!
2 g/t is not always high grade!
At what depths is this 4.0 million ounces measured?
What is the proposed recovery circuit method?
Recovery rates?
I tend to like miners with many neighbors.
Are they permitted and how is SC with mining?
Does SC still make you drink out of airline bottles even when you are at the bar?
It is not like SC is a major mining district. I understand the history.
It is kinda like you do not see many farms in the Sahara.
DYODD and get back. I wish I listened to Al last month!
Fortune Magazine….tell me more!
Hi Dennis,
Thank you for responding re. Romarco.
I’m not sure on the depths, but isn’t open pit usually good to about 400 meters? i don’t know, just asking? As to recovery rate, I believe they are projecting 87.3%.
Here’s some info from Romarco’s website.
“The Bankable Feasibility Study results were announced in
February 2011. The Feasibility Study was completed using a gold
price of $950 and demonstrated robust project economics. The
Haile Gold Mine will be one of the lowest capital cost, lowest
cash operating cost, and highest-grade open pit gold mines in the
industry. Couple that with a politically stable and mining friendly
South Carolina and well established infrastructure and Romarco
is in an enviable position amongst our peers.”
Also: “Exploration drilling is on-going at Haile and will continue at
current levels for the next several years to come assuming
the gold market remains positive. The Company completed
approximately 108,000 meters of drilling in 2010 and has no
intention of slowing its exploration effor ts. In fact, Romarco has
budgeted $30 million for exploration in 2011 and plans to drill
approximately 172,000 meters with 11 drill rigs, making the 2011
program almost as large as the previous three years combined.”
And: “Romarco was named the #1 Mining Company and the #1
Company overall on the TSX Venture Exchange. In November
2010 the Company graduated to the Toronto Stock Exchange.
The Company also received the “2010 Outstanding Business
Award” from the Kershaw, South Carolina Chamber of
Commerce for the contributions made to the town and
community of Kershaw, South Carolina. The Chamber of
Commerce presented me with the “2011 Citizen of the Year
Award” for dedication and service to the Town and Community
of Kershaw, South Carolina. David Thomas, General Manager
and Vice President of Haile Gold Mine received the “2011
Community Citizenship Award” from the Mining Association of
South Carolina.”
As to permitting:
They are currently “Preparing the Draft EIS”
Hope this helps and thanks again for your input.
Much appreciated.
Best
Hi Guys, Josh from Australia here. I bought the majority of my portfolio in Oct 2010 and through 2011. As the Gold/Silver stocks got whacked – I consolidated down from 12 stocks to about 5. Minimized my losses and re-deployed into the best most stable companies. My private portfolio is in the red about 10% – but I’m not really worried. Those 5 companies are quality and it will come back.
My retirement portfolio was purchased through dec-jan 2011/12 – that is diversified and hasn’t seen red – fluctuation is from +4% – +16%. Aussie markets have not enjoyed a break out. But on both fronts I’m not worried. I may take profits in April – but basically I’m hunkering down. I’m 32 years old – I have the time to wait it out.
I have a ratio of 45:45:10 (physical metal:stocks:cash) – I think ill be ok for the US Summer.
Only enemy is my emotions, so prayers would be appreciated
😉
Morning Josh,
Do all you can to keep emotions out of the equation.
Great to have you with us!
Big Al
Jeff Christian is the guy that goldbugs love to hate. But check out this mineweb interview from this week. He suggest that gold demand will taper off here, but the price will stay strong, and that it is time for the pm equities to shine. A really great analysis.
Not a really surprising comment from Jeff.
I don’t agree with much of what he says, but he is pretty bright and I am not in the category him being “the guy goldbugs love to hate”!
Best,
Big Al
Ooops… Here’s the link:
http://www.mineweb.com/mineweb/view/mineweb/en/page96990?oid=148236&sn=2010+Detail&pid=96990
It is appropriate time to make a few plans for the longer term and it’s time to be happy. I’ve read this submit and if I may just I want to suggest you some fascinating things or suggestions. Perhaps you could write subsequent articles relating to this article. I wish to learn even more issues about it!
Morning healthy you vending,
If you are referring to the above link, I will certainly try to accommodate you.
Big Al
Ihre Webpräsenz ist ohne Witz nur zu unterstützen, ich werde mit absoluter Geborgenheit erneut mal blitzsauber anschauen.
Yes, they do need to clean up their website.
One has got to love the negative sentiment. i will climb the wall of worry along with the pms. my jr stocks are “play money” purchased to shoot the moon, all or nothing, these are holds till they are taken over or go bust.
I will hold my physical until it is time to purchase stock or real estate. ie, dow/gold 1-1 ratio. 500 ounces of silver buys a home.
Now you know why I took the plunge! Sentiment has been WAAAAAAY too negative. I honestly think the PMs will surprise to the upside faster than people think. just my opinion.
I agree with you Mark A and that is why I am standing, kind of, on the sidelines and waiting for the trigger to be pulled!
Big Al
Personally I’m sorely tempted to buy a whack of $24 June GDXJ calls.
Hey kids! The Indian jewellers’ strike ends April 2nd. The government is appearing to back down from their 2% excise increase. And when you think about it… what sort of Indian would all of a sudden stop buying gold jewellery just because the price went up 2%?
Indian demand in 1Q2012 was down 50% by some peoples’ measure; but India’s had a tough 1Q generally. You think that a country which has been trading in gold for 3500 years, where millions of people are moving into the middle class each year, is going to all-of-a-sudden see a 50% YOY decrease in demand? Or is it more likely that demand is going to pop back up, to make up for the first quarter?
$HUI and GLDX still look utterly hideous, but GDXJ and SIL look well supported.
I’m even more tempted to buy a crapload of $24 GDXJ calls. This is what baseball players call “a home-run pitch”. I’ve never traded an option before but this is just too darn juicy.
And… I didn’t buy the calls. But I should have. All the analysts I follow called last week the bottom.
Gentlemen,
From one who is an amateur, I went in on Friday. I felt we were at or near a bottom. I have been watching some good juniors, with good resources, management, which I felt were quite undervalued. Took some cash I had parked and went in, as you say, ‘pulled the trigger’. We’ll see if the timing was right. Appreciate all of you!!!!
Hi Al,
My change is don’t fall in love with a stock. I sold out on Scorpio, as an example, just before it crashed down and I have bit in again. Will have no bones about selling out quickly again. These stocks are “burning matches” as Doug Casey puts it. It doesn’t feel like this is the season for sharp rises in prices yet.
Dan