Hour 1 – Looking at the big picture for investors in equities and resources
It was another crazy week with markets and gold all over the place and yields continuing to crash. With these wild swings day to day this is not an easy market to trade.
On this weekend’s show we look at long term fundamentals to help out everyone who is trying to make some solid long term investments. We focus on the precious metals and some of the intricacies to note for the investors in the sector.
- Segment 1 – Mike Larson kicks off the show to address the crash in yields. Even after the Fed rate cut the market continues to push yields into historic territory.
- Segment 2 – Jeff Christian, Managing Partner at CPM Group shares his insights on why the gold stocks are lagging the metals price. It all about the type of investors that entered the sector.
- Segment 3 – George Gero, Managing Director at RBC Wealth Management looks at the recent moves in oil and gold. These are a great barometer for global economic health.
- Segment 4 – We wrap up the hour with an update from Calibre Mining (TSX:CXB & OTCQX: CXBMF). Ryan King, VP Corporate Development recaps the recent Q4 financial results and recent discovery.
Exclusive Company Updates This Week
- SilverCrest Metals – More Information on the New Area 200 Discovery – The Highest Grades Drilled To Date
- Skeena Resources – Drill Program Update and A Look At The Recent High Grade Silver Component
- Auryn Resources – Updating the progress in Peru and the possibility of a spin-out company
We hold these truths to be self-evident, all men and women created, by the, go, you know the thing.
You got it, chief.
https://www.facebook.com/thedailyshow/videos/150072456118468/
FORGET the BIDEN junk………the pet film was the best……..FUNNY…..enjoyed… 🙂
Well, if nothing else Uncle Joe sure gives me a chuckle or two with his gaffes…very entertaining.
Although I know I am not supposed to laugh at our rulers.
Gata……..for those interested…….
10:18a ET Saturday, March 7, 2020
Dear Friend of GATA and Gold:
The gold cartel has blown up from a shortage of physical gold, GATA Chairman Bill Murphy tells Dunagun Kaiser of Reluctant Preppers in an interview this week, adding that all dips in gold are quickly being bought. Meanwhile, Murphy adds, silver remains under price suppression by JPMorganChase, but that could change soon. The interview is 15 minutes long and can be viewed at YouTube here:
https://www.youtube.com/watch?v=3oGn0gg5yAY&feature=youtu.be
CT……will not be interested………run for the exit….. 🙂
Boogie man economics…………….lol
Even Though Tweety Bird didn’t like your rhetoric, he let you fool him with your GATA posts! LOL! DT
Heck, I even fooled myself………. lol …… 🙂
I found seg 2 interesting.
Needing every share of the top 20 companies to have(their minimum) a 5%? gold holding is a good point.
I enjoyed Segment 2 with Jeff Christian as well, and hear the point he is making regarding large investment funds wanting the big boy producers to focus less on growth through Mergers & Acquisitions, and more on profitability and economics, but that was a glass is half empty position to take. I get that some of them are acquisitions simply for growth of ounces or to diversify jurisdictions, but also in many cases the new acquisitions will be more economic and will help the companies to be bring in increased revenues and cash flows.
For example, look at how (USAS) Americas Gold & Silver’s acquisition of Pershing Gold to acquire their Relief Canyon Gold project has worked out in a positive way on their economics. How about (SCZ) Santacruz Silver’s acquisition of Carrizal to get them access to 100% of the Zimapan mine production really helping out their revenues last quarter, and will do so even more this quarter. Another recent acquisition that just closed up was (TGZ) Teranga Gold’s purchase of the Massawa Gold Project from (ABX) Barrick Gold, that will really assist their profitability and overall economics company wide. How about (NST.AX) Northern Star’s purchase of the Pogo Mine about a year ago from Sumitomo Metal, that has been a big boon to their operations. (SBM.AX) St Barbara was wise for the longer term in taking over Atlantic Gold’s Moose River mine. Evolution Mining stands to greatly enhance their production and economics in acquiring the Red Lake Gold Complex from Newmont Goldcorp. (EQX) Equinox acquired the Mesquite Mine from (NGD) New Gold while they were distressed, which really helped their production & economics, and now they’ve merged with (LMC) Leagold which does help their size and inclusion in ETFs, does help with synergies and reduction of redundant costs, and does make them more economic.
Those are some of the recent acquisitions where there are definitely still economic reasons to do some M&A Next down the list is if companies can monetize the acquisition of a development project and grow it into a mine, like what (DSV) Discovery Metals did in buying out (LVN) Levon for their massive Silver deposit, or what (EXN) Excellon just did in buying out (OOO) Otis Gold for it’s Kilgore Project. If they can turn these into profitable mines, then good on them for acquiring them.
_______________________
The other thing that wasn’t mentioned in the discussion with Jeff is the huge liquidity events these Mergers and Acquisitions are in such a tiny resource market. Often when the news of the merger is announced, beleaguered investors holding the asset that gets acquired, gets a nice premium and exit strategy which they can use to roll funds into other companies. Even last week the takeover of Balmoral by Wallbridge, allowed me to trim back much of that position into that shareprice swell of 62% and gave me a gain and dry powder to fire off at deals in the PM stocks when they sold off so hard the end of last week and this week.
That liquidity event, that M&A provides, is an important mechanism in monetizing wins and rotating them into other stocks and provides closure in certain positions that investors may have held for a while to rotate into new names.
—————————————————–
Lastly, M&A also increases speculation in companies of who will be next??
Just recently look at how much both (WM) Wallbridge & (BAR) Balmoral popped on the news of (KL) Kirkland Lake taking over (DGC) Detour Gold as speculation arose about who would be next to go in that area play…. [not to mention both WM and BAR continued hitting paydirt}, and now they just merged.
Merging begets more merging, and that brings excitement into the speculation on picking takeover targets. One more example was when (OSK) Osisko Mining took over (BFD) Beaufield, then it prompted (BTR) Bonterra to takeover (MTO) Metanor in that Windfall Lake / Urban-Barry area play.
Personally, I want to see smart acquisitions that do build synergy and combine assets they are great together as a roll-up than the sum of their parts, in 1+1 = 3 type scenarios. They can be accretive, but they should also show a path to better economics in a reasonable time period for investors, and not just growth for growth’s sake.
Good Post, Ex. DT
Thanks DT. Let the next wave of M&A commence! haha!
After 18 months of bearish technical divergences, the dollar has finally broken down. Of course, in real terms, it broke down over a year ago…
https://stockcharts.com/h-sc/ui?s=%24USD&p=W&yr=3&mn=11&dy=0&id=p01779872377&a=725854168
The Dow Jones US Oil & Gas Producers Index is down nearly 70% versus the Gold Bugs Index (HUI) since late 2018 and looks like it will drop further. An opportunity is setting up…
https://stockcharts.com/h-sc/ui?s=%24DJUSOG%3A%24HUI&p=W&yr=5&mn=5&dy=0&id=p45369551093&a=625540955
That is HU GE……………….
Gann Report……..said the last few weeks in the Dow Drop……..nothing like it in history, according to the charts ,going back several hundred years.
Rambus said oil could drop to $25. I think Clive Maund said $36. So the oils may well go lower.
Watch out, if Clive Maund says it could go to $36, expect it to go to $66…haha. I actually dont mind Clive, but gee he can have an opposite affect on markets. Rambus chartology is always interesting and worth a look
Saudis Plan Big Oil Output Hike, Beginning All-Out Price War
By Javier Blas and Anthony Dipaola – March 7, 2020
“Saudi Arabia plans to increase oil output next month, going well above 10 million barrels a day, as the kingdom responds aggressively to the collapse of its OPEC+ alliance with Russia.”
“The world’s largest oil exporter started a price war on Saturday by slashing the prices it sells crude into foreign markets by the most in at least 20 years, offering unprecedented discounts in Europe, the Far East and the U.S. to entice refiners to purchase Saudi crude at the expense of other suppliers.”
“At the same time, Saudi Arabia has privately told some market participants it could raise production much higher if needed, even going to a record of 12 million barrels a day, according to people familiar with the conversations, who asked not to be named to protect commercial relations. With demand being ravaged by the coronavirus outbreak, opening the taps like that would throw oil market into chaos.”
Oil Now A ‘Bigger Problem For Markets Than The Coronavirus,’ Analyst Says
Sunday, March 8 2020
– “Oil prices plunged on Friday as OPEC and its allies failed to reach an agreement on production cuts.”
– “Crude has become a bigger problem for markets than the coronavirus. It will be virtually impossible for the SPX to sustainably bounce if Brent continues to crater,” Vital Knowledge founder Adam Crisafulli said Sunday.
– “Morgan Stanley forecasts Brent falling to $35 per barrel in the second quarter, with WTI trading as low as $30 per barrel. The firm’s prior forecast had Brent at $57.50 and WTI at $52.50.”
The HUI has taken back an important speed line as well as the 50 day MAs…
https://stockcharts.com/h-sc/ui?s=%24HUI&p=D&yr=1&mn=3&dy=0&id=p39709366609&a=702521099
Bora Bora Capital @Steve63051825
“Very interesting parallels to today. In 2007 $gdx dropped -24% just as it was about to breakout. Then, gdx rallied +67% in 9 weeks. Today, we dropped -21% just as it was about to breakout. Above $31 now with similar action to 07’ would target $42.50, quickly. $gold $gld $gdxj ”
#Chart
https://twitter.com/Steve63051825/status/1236320769182818306
State of the Resource Market in 2020 – Christopher Aaron
Cambridge House International – #VRIC – Feb 27, 2020 #VIDEO
Gold & Silver Price Update + Coronavirus Fears
iGold Advisor – Christopher Aaron – Mar 6, 2020 #TechnicalAnalysis #Chart #VIDEO
Ira Epstein’s Metals #Video (3/6/2020)
Technical Analysis, Gold, Silver, Copper, Platinum
Gold & The Miners: Fabulous Technical Action #Video
Mar 6, 2020 – Morris Hubbartt Super Force #PreciousMetals #TechnicalAnalysis
Gold Trades In Fast Market Conditions
The Gold Forecast – Gary Wagner – Mar 6, 2020 #TechnicalAnalysis #Chart #VIDEO
Gold Is Rising Amid the Swings in Stocks. Here’s Why the Rally Has Legs.
March 6, 2020 – By Andrew Bary
“Gold is living up to its reputation as a haven during turbulent times.”
“The precious metal is up 10.7% this year, to $1,673 an ounce, a seven-year high.”
“Gold is responding to systemic financial risk,” says Joe Foster, a manager of the VanEck International Investors Gold Fund (INIVX). Foster argues that gold isn’t simply an inflation hedge, as it was during the 1970s, but benefits more broadly from financial, geopolitical, and economic dislocations, including the impact of Covid-19.”
“The flows into gold are just getting started,” says Peter Grosskopf, chief executive of Sprott, a Toronto asset manager focused on precious metals. “Gold is now being seen as mandatory portfolio insurance and not a fringe asset.” He says that ownership of gold among institutional and retail investors remains low, with few even having Sprott’s recommended asset allocation of 5%.”
https://www.barrons.com/articles/gold-dazzles-amid-dark-days-for-stocks-51583511414
Watch CNBC’s full interview with Jeffrey Gundlach
Mar 5, 2020 #VIDEO Interview
“CNBC’s “Halftime Report” team is joined by Jeffrey Gundlach, CEO and co-founder of Doubleline, to discuss the Federal Reserve’s emergency rate cut and the bond market’s reaction.”
(He also mentions Biden is “unelectable” and that he’s been recommending to buy Gold since the Summer of 2018)
Copy cat …..is referring to Gundlach
On March 6, 2020 at 3:17 pm,
OOTB Jerry says:
COPY CAT…………….he must be watching us here
WOW! The “Bond King” Jeff Gundlach says gold is going a lot higher, doesn’t that mean bonds…and ALL other paper is going “a lot” lower? Do you understand? We assure you, if there is a “seizure” anywhere in credit, there will be a seizure everywhere. Please remember these words!
“Gold Is Going A Lot Higher” – DoubleLine’s Gundlach Warns Of “Seizure In The Corporate Bond Market”
I posted this yesterday…..I thought it was funny that Gunny was coping our thoughts… 🙂
I think we said over a week ago……..GOLD GOING HIGHER………LOL
Heck, we been saying it for years……………LOL
Watch next week………Gold is going to TANK……wash and rinse…. 🙂
Too Right OOTB !
Most of the markets are trying to keep up with KE Report Crew, as we stay ahead of the curve.
While we’re busy innovating, they’re just replicating. 😉
Ha, ………good one……..right on….. 🙂
PDAC 2020 | Day 1 Update
Investing News Network – March 2, 2020 #VIDEO
“The coronavirus was in focus of day one of PDAC, with resource sector heavyweights like Eric Sprott and Rick Rule providing commentary on its effect on the gold price.”
PDAC 2020 | Day 2 Update
Investing News Network – March 3, 2020 #VIDEO
“The coronavirus remained top of mind for PDAC attendees on day two of the convention, although protesters outside the building were a topic of conversation as well.”
PDAC 2020 | Day 3 Update
Investing News Network – March 4, 2020 #VIDEO
“On day three of PDAC, the INN team took to the floor once again to cover the convention, with highlights including visits from Canadian Prime Minister Justin Trudeau and Ontario Premier Doug Ford.”
Despite the new highs of January and February, I think the correction in the miners that began last September ended with last week’s plunge to important supports…
https://stockcharts.com/h-sc/ui?s=%24HUI&p=D&yr=1&mn=7&dy=0&id=p25243715196&a=725860897
It makes sense that the correction would end with a test of those important moving averages. Here it is with 200 period MAs rather than the Fibonacci-based 233s…
https://stockcharts.com/h-sc/ui?s=%24HUI&p=D&yr=1&mn=7&dy=0&id=p59907894326&a=725860897
The “sell stocks, buy miners” trade looks better now than before the miners were hit…
https://stockcharts.com/h-sc/ui?s=GDX%3ASPY&p=W&yr=5&mn=0&dy=0&id=p34475570884&a=686435930
GDX quick backtest of 50 week MAs:
https://stockcharts.com/h-sc/ui?s=GDX&p=W&yr=9&mn=9&dy=0&id=p82263299292&a=542616395
Good charts Matthew, cheers!
I wonder if we will here a roar of panic coming from the stock market next week. It is always the unknown which causes panic and there is a lot of hurt and the situation seems to be changing at a moments notice. DT
I find it absolutely amazing that a big crash hasn’t quite happened, the storm still hasn’t broken in full force. DT
But It’s Close!
The herd is so used to their 401K statements increasing,sentiment will not change until they start opening their statements and they see their retirement going the wrong way.
I still am in dismay as to how ignorant some people are concerning their retirements. I ask them how their 401K has been doing, they say they only look when their statement comes.
This time not only will the sheep be sheared, but rather they are about to be slaughtered and sold for mutton while the Wall Street crowd fleeces their retirement.
Martin Luther King Jr said it well. ” Nothing in the world is more dangerous than sincere ignorance and conscientious stupidity.”
This weekend the robo-advisors will be going over their accounts to see where the “air- holes” are and to see if they need to send out further calls for margin.
Isn’t the whole buy and hold and keep contributing annually strategy involve not looking at your statements ever……it’s a long term game. Trust us the results will be there in the end
Got back in to the impact just before the close on Friday when it dropped again to .415….. was in and out of it all last week….great trader in these volatile times
On Monday, bold action will be required by the computers in the offices of The Federal Reserve and the Central Banking Institutions if the bell wether securities on The Dow need to be steadied. Computers perform much better than humans to keep trading on an orderly basis. Computers do not feel hysteria unless they too crash! DT
We live in a world dominated by artificial Intelligence but most don’t see it and believe that humans are infallible.
The wizard behind the curtain is a quantum computer! DT
.I’m not infallible???…..thanks for bursting my bubble…
The biggest bubble in Toronto is in construction. There are over 120 cranes operating on high rise buildings. One site run by Ellis-Don (Bloor and Bathurst) has over 5 cranes. Your bubble hasn’t yet burst, but it will happen soon enough, this can’t last. DT
The best time to hire a contractor is after the bubble has burst, you will see what I mean.
I’m old enough and wise enough to know when the bubble is set burst….one of the best clues is when the contractors are becoming investors and have their own money invested in 3 or more homes themselves and are looking to double dip…….first thing that happens is all the subtrades aren’t getting paid on time cuz the money is tied up in the next house and everyone finally gets paid when a place sells.
Wolfster you just took me down memory lane there with that post, and you are so right.
I remember my buddies were building homes in 2005, 2006, 2007 and the sky was the limit, and they got into doing “interest only” loans, because home can only go 1 direction in value right – straight up! (only then the end of 2007 came and there was some stagnation….. and then the 2008 and 2009 financial crisis hit and they had their clocks cleaned by putting all their eggs in one basket – real estate).
Most of those contractors left the business never to return (some with streets and homes in their “no lose” development projects only half finished). Some never recovered.
At the time I was doing home loans, car loans, bank deposit products, annuities, and insurance products, and so many families came in that financed their life on the dream that their home equity would only keep going higher….but like all bubbles it popped with wailing in the streets, and pain for so many people.
Ex, that is fine as long as this time it is not like 1929 but instead like 2008. DT
DT – I believe this time it will be like 2020. (20/20 Vision baby)
Hindsight will be 20-20 and we’ll see if was more like 1929, 1987, or 2008 by the next year or two.
Until then…. Ever Upward!
Black Monday: Shades of October 19th, 1987
by @Goldfinger on 9 Mar 2020
“Black Monday was a Monday in October 1987 in which the S&P 500 fell 22% during a single trading session. There are many similarities between then and now, including the fact that markets were already extremely shaky heading into today’s trading session and news deteriorated further over the weekend.”
“At this point the words “perfect storm” are already overused, however, they are indeed apropos. I couldn’t think of a more perfect scenario to crush global markets than the one we are experiencing right now.”
https://ceo.ca/@goldfinger/black-monday-shades-of-october-19th-1987
This was just mentioned on Bloomberg financial news:
“Former Fed Chairman Alan Greenspan says he can’t rule out the possibility of negative yields on 30 year bonds.”
https://s3-us-west-2.amazonaws.com/cdn.ceo.ca/1f6a4ri-received_507172506665291.jpeg
https://s3-us-west-2.amazonaws.com/cdn.ceo.ca/1f6a4ri-received_507172506665291.jpeg
This was just mentioned on Bloomberg financial news:
“Former Fed Chairman Alan Greenspan says he can’t rule out the possibility of negative yields on 30 year bonds.”
https://s3-us-west-2.amazonaws.com/cdn.ceo.ca/1f6a4ri-received_507172506665291.jpeg
Oil is down 21% and testing a big pitchfork support:
https://stockcharts.com/h-sc/ui?s=%24WTIC&p=W&yr=7&mn=11&dy=0&id=p90203560289&a=725914206
Matthew,
Oil in my opinion will find solid support at $30 -34 level. Oil stocks can down a little further though. I have list ready to buy when time comes (hopefully in next 1-2 weeks). There is complete and total annihilation of E&P sector. This is beyond blood on the street phase.. Any adjective will fall short to describe what’s going on with oil stocks.
Going to go long on HAL, RIG, SLB
CaliJoe, as you can see above, that fork could mark substantial support so I agree.
Don’t forget this potential blow-off bottom in the works:
http://schrts.co/rJgGhRmd
At a time like this, it’s worth remembering…
https://www.youtube.com/watch?v=Hatav_Rdnno&t=21s
Cali, I suggest you wait. I warned BB when SLB was a lot higher. I believe HAL and SLB have a further move to the downside. I’ve been licking my chops watching these stocks go lower.
Oil down to $32.40
Oil plunges over 20% after Saudi Arabia slashes prices on OPEC deal collapse
March 8 , 2020
After gaining 10%+, GDX:DIA had its best weekly close since August and is on a new weekly MACD buy (its first since last June).
Note that the 200 and 233 MAs are no longer plunging as they were in 2016:
http://schrts.co/VBZXvAJu
The weekly close happened at Fibonacci fan resistance (blue, speed lines are red) that should fall easily now that stock market futures are down over 4% while gold and silver are moving sharply higher.
http://schrts.co/fFQwWIay
Monetary metals gold and silver are up, industrial metals platinum and palladium are down. Bitcoin and the dollar are also down.
Being undiversified and without exposure to oil, uranium or the stock market has worked out well for me lately, that’s for sure.
Gold is hanging up in the green along with Bonds as #SafeHavens, when most other assets are in the red, and much of this is being triggered by the Oil rout.
Being in Platinum and Palladium miners in January & February worked out well for me, that’s for sure. I scalped some great gains of in the few PGM stocks I held, for several weeks when Gold and Silver miners weren’t doing much, for those not diversified in other sectors.
Being invested in the general stock markets in my retirement fund has worked out for me over the last decade, that’s for sure. Many investors not diversified into the US equities completely missed a easy 11 years of nearly straight up action, that’s for sure.
Being in Gold & Silver miners the last few weeks has not worked out well for most investors, with many stocks down double digits, that’s for sure. There are some investors over at ceo.ca and stockhouse bellyaching that their undiversified basket of just a few Jr Gold & Silver stocks is cleaning their clocks…. that’s for sure.
The biggest worrying and gnashing of teeth is coming from the Oil & Gas investors though, and that sector has been taking behind the woodshed and beaten for over a year, and the prices dropping like a stone to $32 are not going to help their cause… that’s for sure.
Ex,
I came across a list of E&P companies that have their production already hedged at $55 a barrel and they too are being destroyed. They have no liquidity issues, no near term debt maturity but trading in pennies. Maybe they all will go to ZERO
Hi CaliJoe – While they ALL won’t go to zero, some of the more distressed companies will got bought out for pennies on the dollar, go into credit protection, or yes, a few will go to zero. The Oil & Gas sector as whole is going to get it’s butt kicked hard here.
Many have been postulating all weekend that this move by Saudi Arabia was aimed at tanking the US shale oil plays that need Oil in the $40s-$50s to be viable, but even at those prices, many of the Oil & Gas stocks were getting bloodied up.
This Energy conflict is going to get ugly fast, and will effect the markets in a bearish way.
> Hello volatility. (I was considering buying the VIX last week and am kicking myself for having hesitated).
There’s a time and place for owning the other sectors but it has made no sense to me. The charts have not been compelling. As for my gold and silver holdings, we had a couple of big back-to-back gaps up that were sure to get filled and they did. My portfolio is still higher than it was right before the big up week that brought us those gaps. Overall, I’m virtually unscathed and it didn’t hurt to buy the crash lows.
XAU versus Dow just had its highest weekly close in over two years:
https://stockcharts.com/h-sc/ui?s=%24XAU%3ADIA&p=W&yr=4&mn=5&dy=0&id=p80266248734&a=707626462
There’s only one bull market out there.
Matthew congratulations on remaining mostly unscathed, but your performance is the exception and not the rule, and most investors are down in their PM stocks in almost every discussion I’ve been in or read.
I’ve had people PM’s me down 10’s or 100’s of thousands of dollars just in the last few months accented by even more pain the last 2 weeks. I’m sure there are whales that are down millions. When I’ve asked these folks if they had other funds in the general equities, other currencies, or different commodities, most had shockingly little diversification (some did have retirement funds in US stocks, but some with Canadian, Australian, German, Japanese, or Chinese market exposure weren’t even that thrilled about those retirement accounts).
Personally, my Gold and Silver stocks are down about 14% over the last few weeks, but there have been a few bright spots where I booked profits on good swing trades or the recent takeover of Balmoral, and rotated those funds into some of the harder hit PM stocks.
Ironically, my Uranium stocks and Lithium stocks have been so boring in 2020 that they’ve mostly been flat overall, and didn’t factor into many gains or losses, but in this environment where almost everything is getting whacked, that is another blessing of being diversified across different sectors.
I didn’t say my experience was the rule. I’d be worse off without a little luck and a little trading (which I could have/should have done much better with).
I’m just glad I didn’t diversify for the sake of diversifying. I’ll do it when it makes technical sense.
I never said that you did, but your post seemed to insinuate that holding a small basket of PM stocks was superior to being diversified in the recent environment, and most investors that took that approach, got their rear-ends handed to them.
You likely did better than 95% of PM investors and picked a few real winners, but most folks have Jrs down 20-30-50% the last few months, and likely wish they had diversified into other sectors. That was the point I was making.
Again, congratulations on outperforming and holding onto your capital. Most didn’t.
There are roughly 1493 retail investors in the ceo.ca stock picking contest this year, and while some are in cryptos, cannabis, uranium, lithium, or base metal, the vast majority are in gold & silver mining stocks.
The results in 2020 just since January have been fairly negative overall, with most picks having lost money since Jan 1st a little over 2 months ago.
_________________________________________________________________
Stock Picking Contest Update – March 1, 2020
by @EvenPrime on 6 Mar 2020
“By the end of January, 62% of users were below their January 1st, starting price. ”
“And by the end of February, 85% of users (1,271 of 1,493) in the contest were below their January 1st starting prices.”
https://ceo.ca/@evenprime/stock-picking-contest-update-march-1-2020
Yeah Ex. My one pick a bio play is down so much it crushed the gains I have with my two renewable plays. Meatloaf was wrong in this instance. 2 out of 3 can still be bad
Look Ex, this is a zero sum game. I would never suggest that everyone can do well at the same time. After reading comments on a number of sites, my results had better be different than the majority. Most do not have a clue most of the time so most should buy and hold a bull market using ETFs. Those who bought GDX near the low last May and simply held are worth as much as 46% more stock market now. They are also worth as much as 113% more COPX (copper stocks) and as much as 77% more URA (uranium stocks).
It seems most prove that a little knowledge is worse than no knowledge as it causes people to pick stocks (greedily I might add) instead of just buying a fund of some kind.
Of course there’s the issue of timing. Most will never buy even close to a low.
So I don’t know why you’re comparing what everyone else does to what has been true for me. It’s completely irrelevant. The fact I was conveying is that I would be worse off had I diversified just for the sake of diversifying.
It always blows my mind how people marry their positions and never sell. Look at the guys who rode KL up and then down. That’s an extreme case but there are more extreme cases and that’s how most people roll so what’s the point in thinking about how “everyone else” is doing?
Btw, if you haven’t sold the stock market in your retirement fund, you’ve given back a lot of gains, especially in real terms (the terms that matter).
Versus gold, SPY is where it was 2.5 years ago.
https://stockcharts.com/h-sc/ui?s=SPY%3AGLD&p=W&yr=5&mn=0&dy=0&id=p65080030460&a=724061228
I haven’t done anything but add to my retirement accounts since 2008, but I did reallocate some funds over to bonds (which has worked out), to a few different emerging markets (which hasn’t done as well as the US markets), and spread the US funds over mutual funds with the larger cap dividend paying defensive stocks, the Mid-Cap & Small-Cap growth funds, and a few with more real-estate focus.
While my retirement funds have gotten hit recently in nominal terms (just like almost everyone’s), I agree that when compared to Gold itself, they’ve lagged due to the yellow metals trek higher. I’ve considered rotating out of so much US focus in them, but haven’t been impressed with most emerging market funds, and the part I put in the bonds has done better than I expected, but is likely to top out at one point.
There aren’t many places to hide in chaos, but of course, I’m a fan of the Precious Metals, and may move some of the retirement funds over to PM focused funds for the next few years.
I’m curious to see what shenanigans the FED and other Central Banks pull first to see if they try and “save” the markets for on last pop first though.
I think oil stocks are setting up for trade of the decade. I have no desire to diversify in to anything else other than already holding a few miners. I’m firmly convinced that oil stocks are more double from here in less than a year ( at least the ones I’m going to purchase)
The oil and gas stocks are getting their rear ends handed to them, but the weakness may last longer than some expect.
Goldman Sachs sees $20 oil as a possibility:
___________________________________________________________
Goldman says coronavirus and oil ‘price war’ could see crude plunge into the $20s
By William Watts – March 8, 2020
“Goldman Sachs commodity analysts on Sunday slashed their forecast for crude prices, after an alliance between Saudi Arabia-led OPEC and Russia collapsed late last week launching a new “price war” that threatens to deliver “acute financial stress” to shale drillers and other high-cost producers.”
Oil Plummets 31% In Biggest Drop Since Gulf War as Saudi Cuts Spark All-out Price War
Rosie Perper and Theron Mohamed – 1 hour ago
“Oil futures tumbled 31% in a matter of seconds overnight on Sunday, their sharpest decline since the Gulf War in 1991. The losses are being fueled by sinking demand due to coronavirus concerns, which has in turn sparked a series of price cuts.”
“Saudi Arabia slashed its prices by the most in at least 20 years over the weekend. A price-cut free-for-all has broken out globally following the collapse of an OPEC+ alliance last week. Talks broke down after Russia refused to meet Saudi Arabia’s request for output cuts, which would boost prices.”
“Futures on the Dow Jones Industrial Average sank more than 900 points, while S&P 500 futures were hit with a 4% drop at open on Monday. Goldman Sachs analysts have warned that the price of oil could tumble even further, to $20 a barrel.”
I agree, CaliJoe.
Ex, the low will come and virtually everyone will find a reason not to buy. That’s what always happens. Yes, things will look their worst when the low comes but that is also what always happens. Looking for improving fundamentals or “catalysts” will be a waste of time because both are worthless for timing any market.
We agree there Matthew – the low always comes, but there may be longer to go before it finds bottom.
When the low came last time at $26, I was buying the Oil ETFs at that low, but sold off a few days later still not sure if would hold, because it is difficult to buy when there was so much gloom. However, it looked set up for an intermediate term technical bounce, and I did buy back into the Oil Producer and Oil Service stock ETFs a week or two later and held them for a while, catching most of the move up to $40, but got out of that sector there, and did not continue to ride it up to the $60-$70 oil prices as the producers, explorers, and oil service companies didn’t seem to be as peppy as the mining stocks were. I’ve never gotten back into the Oil & Gas space since that time.
I’m sure there will be some great opportunities to get into some of the quality Oil & Gas names in the near future at amazing cost basis positions, but I don’t follow that sector close enough to know which ones to pick as stand-alone companies, and which ones are in trouble and will get flushed.
If I was to position I’d likely just use the ETFs (XLE) for the larger comapnies, (XOP) for the Jr companies, and (OIH) for the Oil service companies again.
I’m sure there will be some great opportunities to get into some of the quality Oil & Gas names in the near future at amazing cost basis positions, but I don’t follow that sector close enough to know which ones to pick as stand-alone companies, and which ones are in trouble and will get flushed.
If I was to position I’d likely just use the ETFs (XLE) for the larger companies, (XOP) for the Jr companies, and (OIH) for the Oil service companies again.
I agree, oil is too friggin cheap at this level, maybe it will stay this way for a week or two at the most and literally everyone will find reasons not to buy. This is how 2015/16 bottom occurred. Most E&P stocks doubled, tripled a few months later. I think this is a gift, don’t think one should just let it go in vain. Remember, big money is being made in crisis.
See above. I would be very careful with oil stocks. I believe most of them have further to fall. As mentioned, I warned BB months ago about SLB and i believe the odds are it falls even further from these levels. There probably won’t be a V recovery in these stocks so you have a lot of time to let them settle down.
Doc, So glad that you’re here. I don’t own any of these stocks but I think bottom is close. Certainly not in days but I don’t think recovery will take months either.
CaliJoe, the likes of HAL could bottom very soon. Like many others, it is very oversold already and will get smashed tomorrow. Not nearly as much time is needed to wring-out a market when it falls fast and hard.
Oil has now been as low as 27.90 – that’s about 60 barrels per ounce of gold (the 50 year average is about 15 barrels per ounce).
In 2016, the miners took off just as the gold oil ratio was topping and the same could easily happen this time. The conditions right.
https://stockcharts.com/h-sc/ui?s=%24GOLD%3A%24WTIC&p=W&yr=5&mn=5&dy=0&id=p58270025533&a=726062746
That’s an interesting chart with the Gold:Oil ratio topping and SILJ bottoming back in 2016 and a similar pattern recently.
I wonder if the Fed will step in with another cut before the upcoming meeting. If not, stocks could fall much further since there’s no reason for shorts to cover and there are probably not many deep pockets who’d call the current levels a bargain.
Jeffrey Gundlach seemed to think they would do another 50 point cut, and possibly at or before their next meeting. I posted this further up in the blog, but will post it again here for quick reference.
Watch CNBC’s full interview with Jeffrey Gundlach
Mar 5, 2020 #VIDEO Interview
“CNBC’s “Halftime Report” team is joined by Jeffrey Gundlach, CEO and co-founder of Doubleline, to discuss the Federal Reserve’s emergency rate cut and the bond market’s reaction.”
(He also mentions Biden is “unelectable” and that he’s been recommending to buy Gold since the Summer of 2018)
Thanks, I bet he’s right.
I posted a good talk of his weeks ago in which he had Biden and the rest pegged:
https://youtu.be/JDSFxzJQzh0?t=3570
He also said never buy triple A corporate bonds and I agree. I avoid the best gold producers for the same reason.
Cali, for the first time in years oil demand has dropped due to the virus. It should take time to recover from this. Also, the Saudis are now flooding the markets with oil after Russia refused to cut production. I think the odds are very good that we can see close to 12 for SLB and a whopping 5 for HAL. If this virus thing throws us into a glonal recession, it’ll probably be severe and take time for the demand for oil to rise. You are right however to feel that those who buy in the medium term will make out very well if they’re long time holders.
Markets are good at discounting all known information and panics are good at overshooting so the low is likely to happen before any recovery. Then there’s the Fed. It will wreck the value of the dollar which will put a nominal floor under everything.
In real terms, oil just hit its cheapest level since 1933.
To avoid buying at an 87 year low seems to me a little like looking a gift horse in the mouth.
Confidence is Brewing, Is The Uranium Renaissance Upon Us?
19 hours ago | Barry FitzGerald
“Other than the gold and iron ore space, things are pretty glum in the broader mining market thanks to the pressure on commodity prices caused by the threat to global economic growth from the coronavirus.”
“Among all the gloom and doom though, spare a thought for the decimated uranium sector which continues to wait for its long promised demand and price recovery.”
“Tim Gitzel, president and CEO of Canadian uranium giant Cameco, was as upbeat as a uranium producer could be at the recent heavyweight BMO metals and mining conference in Florida.”
“Demand is in an upswing, with (electricity) utilities having a growing wedge of uncovered requirements, precisely at the same time that supply is on the downswing. Today’s prices are only exacerbating this trend,’’ Gitzel said.
Uranium Curtailments from 2016 to 2019:
That link above didn’t work, but this should:
https://pbs.twimg.com/media/ELS8-FlUEAAEYKd?format=png&name=900×900
That is what supply disruption / destruction looks like. Once the utility companies finally do come back to market to set up longer term off-take agreements, they are going to be surprised to see that there is hardly any operational production left at this point. It is a very unique combination of factors that should eventually reach a tipping point in the not-so-distant future.
Bitcoin down 11.41% to $7,843. It is not getting the safe haven bid lately.
David Scutt @Scutty on Twitter:
“Australia’s S&P/ASX 200 Energy Index tanked 20% today, near-doubling the previous record daily % decline of 11.8% which also occurred on Oct 8, 2008.”
May as well say………GRS…………100 to 1………..(99.6)…….
WAKE UP SILVER……….you are way behind the curve…….. 🙂
OH MY>………….GRS……….just made a HISTORICAL EVENt………….100.7 to 1……..
GRS……..to GSR……….
Jerry, I believe the GSR hit 105 in 1991 but I can’t show you a chart because stockcharts isn’t working right now due to the markets being closed.
Stocks are “limit down” and my screen shows the Dow down close to 2,000 points/7.3%
Now everything is trading again (except NEM) but stockcharts still isn’t working.
Fed to step up cash injections for banks to guard against market pressure
Don’t you love it? The Fed is the cause of the bubble that has popped but the masses think it’s our savior.
Ditto……….clueless public……….
Thanks Matthew……….appreciate the comment………
Everyone to the screen………….DOW.DOWN……….1800 plus……Shorty is going to get rich on this one……….
banned
Plunge Protection Team trying to come to the rescue…can’t let the Stalingrad and Poorski 500 go…after all today is the 11th year birthday of the bull market…
I loaded up on OXY this morning. Trader Vic mentioned this on a weekend show. So many good bargains out there in oil sector.
OXY has a lot of debt
Poor Sleepy Joe…chooses truth over facts…make sure you have the record player on at night…make sure the kids hear words…
https://twitter.com/realdonaldtrump/status/1234695977656881154