Erik Wetterling – Retail Investors Continue To Shrug Off Good News In Gold Explorers And Most Of The Junior Nickel Companies
Erik Wetterling, Founder and Editor of The Hedgeless Horseman website, joins me to review the continued lackluster interest from retail investors in most of the gold and nickel exploration stocks, and the persistent trend of shrugging off good news and further value-creation by the resource companies.
Erik points to the recent encouraging news released recently by 2 gold explorers, Altamira Gold (ALTA.V) and Goliath Resources (GOT.V), to little fanfare or traction in the sour sentiment backdrop. We speculate on how different the reactions may have been to the exact same news in a positively trending sentiment environment. Next we get into all the solid work advancing projects building value that a handful of nickel explorers and developers have been doing; flagging Canada Nickel (CNC.V), FPX Nickel (FPX.V), Stillwater Critical Minerals (PGE.V), and Magna Mining (NICU.V). There is a stark dichotomy between this work attracting a number of the larger base metals and manufacturers as strategic investors; while simultaneously most retail investors are tuned out and remain apathetic. *
*In full disclosure, the companies mentioned by Erik in this interview include personal positions in his portfolio, and they may also be site sponsors on The Hedgeless Horseman website at the time of this recording. Additionally, Shad has positions in Goliath Resources and Stillwater Critical Minerals at the time of this recording.
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I get where you’re coming from with that point Lakedweller2, but if you look at the volumes traded on many shares day after day, week after week, it is very low overall (buyers or sellers). It really seems more like trading apathy and a lack of interest at all, compared to a big short movement. Just a slow bleed to the downside in many of the juniors.
Pretty much everyone agrees with you and you are most likely right. I am just trying to find some factual information explaining 2 years of almost daily similarities of how my account performs. The more it performs the same, the more unlikely it is market action but rather intervention of some form. You have banged it into my head that I have too many explorers with the highest risk. That may be true, but that doesn’t explain repetitive action despite things like physical gold being at an all time highs. Simultaneously silver failing to go higher and performs more like my account. But, my account contains gold,silver, copper, lead, zinc, palladium, platinum, uranium, US, Canada, Mexico, Finland, Sweden, Spain, Columbia, Peru etc.
Then I listened to the guys discussing the save Canada mining”, as well as, the new Southern District of New York case concerning broker liability concerning naked shorts. The eye opener was that not only does it appear brokerage firms are allowing naked shorts, but there is also evidence that some are not required to cover naked shorts they shouldn’t have been allowed to acquire.
Now going to your point of low volume, that would make the power of shorting even greater and could easily be to levels driving price direction … which is illegal manipulation. The secondary result is with shorts driving price direction, they could also drive away investment … which is definitely “an” explanation but short of explaining repetitive performance .. as much as orchestrated naked shorting with brokerage firm assistance. If that hypothesis has merit than there are a myriad of reasons why “monied and political interests” would like to see Junior Explorers of merit forced to lower value no mater if it unfairly hurts investors or not. The many facets of “greed” alone would rationalize such criminal behavior.
Just thinking out loud…
A thought came to me as you guys were talking. What if it is not a “lack of buyers” but an excess of shorters. The “ Save Canadian Mining” movement has already indicated there is shorting, naked shorting and naked shorting that is never covered.
The Southern District of New York recently came out with a case that indicated, in essence, that if Regulators are not going to regulate, then The Court said that Brokers are responsible for allowing clients to naked short and particularly liable for allowing clients to naked short and “never cover.”.
I have often thought that the shorting of Juniors was because they weren’t in ETFs or Index Funds or other derivative products of managed money. But, it actually could be that there is even less “regulation” of Juniors not with managed accounts opening the door for “enabled” naked shorting. Since brokers are “now” liable, and it is possible to identify which brokerage firms are allowing naked shorting violations, it could be productive to go after these shorting issues through criminal and civil complaints against brokers. That could be the trigger to turn the miners.
(If a broker is willing to allow naked shorting without covering, what keeps them from “naked selling” without obtaining the shares. Just make a computer entry in someone’s account. It is not as if anybody has physical paper share certificates anymore.)