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  1. frizzers


    SILVER thread / new edited charts - April 2018 SLV / Silver etf ... Two year chart : 5years : 6months : 10days : Latest ============== GOLD & Silver Poised? Maybe Silver shares / SIL: Global X Silver Miners SIL- etc ... update GOLD READY FOR HUGE RUN HIGHER - Keith Neumeyer Silver is cheap: GOLD- to- Silver Ratio is over 80:1 SIL (silver shares) look Cheap relative to GDXJ (Junior Gold shares): Ratio: SIL -to-GDXJ == (Original Comment : Aug. 2006): First, the downside It's VERY volatile, (gold fell 1.8% this week, silver fell 4.8%), but if you hold physical without leverage that doesn't matter so much. It's hard to store, but ... you can buy the ETF (SLV), and pay nothing, or use Goldmoney.com or have an unallocated account with Baird's (goldline.co.uk) and pay a bit. (2.5% for Goldline) What I Like About It: It's a double play: a monetary metal and an industrial metal. It will go up significantly if the commodities boom plays out. It will go up significantly if Fiat currencies, the dollar in particlar, come under pressure. There is more upside potential than gold. My own experience is that I bought a load of physical gold and silver earlier in the year. The silver has gone up by considerably more. Looking at the wider picture, currently, the gold silver ratio is about 53:1 or more. In olden times 14 or 16 (depending on which history you read) silver coins were equivalent to a gold coin. So a ratio of, say, 15:1. If the gold price stays at 625 and we return to that historical ratio, silver should be $41.6 - nearly 4 times its price today. If gold goes to Sinclair's $1650, and the historical ratio returns to the mean, silver will be $110. About TEN times its price today. Gold will merely have trippled. If gold goes to James Turk and Marc Faber's $5000, and we get that return to the mean, you're looking at $333 silver. A cool thirty bagger. But there is more to it than that. Because gold has comparitively little industrial use, it doesn't get consumed. The amount of gold in the world doesn't change that much year on year. It increases by the amount that gets mined every year, less the amount that gets lost. Silver, on the other hand, gets consumed. It is widely used in minute amounts as a very efficient electrical conducter in mobile phones and computers, for example. But the amount is so miniscule as to make it not worth recovering when that phone or computer is no longer worth using. So gradually the amount of silver in the world is decreasing, by more than is being mined each year. Previously this didn't matter as the surplus of junk silver coins in the US compensated for the consumption, but that supply has now gone and the US government is now a net buyer. You're looking at a very basic supply and demand situation which at any moment could cause a dramatic spike upwards in the silver price. Silver gets used in such small amounts, yet so widely, that a spike up in the price wouldn't actually have that serious an effect on the books of that mobile phone or computer manufacturer - a similar phenomenon goes on with uranium. Some silver bugs have argued that the diminishing supply of silver could even push the gold silver ratio to 1:1 . I think that's unlikely, but that would make silver a 60 bagger at these prices and god knows what if gold goes up too. I will start buying significant amounts of silver with my STR fund, when I feel the August correction is at or reaching its low. I will buy it and hold it, tempting though it is to trade in and out. I'm hoping for $25 silver by the spring.
  2. First Mining Finance Corp / FF.t There's a new IPO coming to Canada in the totally bombed out sector that is junior mining. UPDATED CHARTS TLG vs. FF, OIII, ATC etc ... from 2.19.20: w/ATC 1yr: 6mo: 10d / LAST $0.98 / FF-0.405= R2.42X FF.t / First Mining Finance ... weekly : 2-yrs : 6-mos / 10-d Ratio: FF.t -to GDXJ ===== The man behind the deal is Keith Neumeyer. For those of you that don't know Keith, he built First Majestic Silver (TSX:FR) and took it from penny stock status to $25 a share (in the heady days of 2010-11) with a 3 billion plus dollar market cap. It is now one of North America's leading silver producers and even in today's beaten up silver market it remains profitable with a market cap of around C$900m and a share price of $7.50. Keith was previously behind First Quantum Minerals (TSX:FM), which followed a similarly enormous trajectory to become one of the world's biggest copper producers. His record in mining is pretty much second to none. Also involved are many of the other key personnel from First Majestic, such as Ramon Davila and Raul Diaz. The strategy of the company is, simply, to tap into their huge knowledge base and use it to acquire as many quality mining assets as possible (Americas only) while they are going for a song (we're currently seeing the lowest valuations in 20 years), spend as little as possible on them (watch them 'incubate' I believe is the word) and wait for the time that the mining capital markets stabilise at which point they hope to have a pucker portfolio of assets on their hands. Revenue will eventually come from re-sales, JVs, royalties and streaming structures. They already have 18 properties at various stages of development (gold, silver, copper, lead and zinc) and have raised C$2.7m. The company will IPO in Canada via an RTO next month and plans to raise another C$5-10m (at 50c) in the process. A C$10m raise would mean 80m shares outstanding an an approximate market cap of C$40m. Management will own about 10% and First Majestic shareholders 25-30%. The success of First Mining Finance depends on the metals markets, of course, but the ideal situation would be for them to remain depressed for another while so that assets can be picked up for zilch and for things to then pick up, as surely they one day will. I don't know what the market reaction to the stock will be, of course, but I suggest this is one to hold for three to five years. Anyway, if you are interested in finding out more or in taking part in the IPO, please let me know and I'll send over forms. If you want to speak to Keith, I'll try and arrange that too. frizzers at gmail dot com. (I'm investing fwiw) Here's the Powerpoint. ===== LINKS FF Website :: https://www.firstminingfinance.com/ Presentation, Nov.2017 :: https://www.firstminingfinance.com/_resources/Nov_2_Presentation.pdf
  3. FCC, Cobalt & Mystery metals set to shine ever brighter (reviving old Frizzers thread) Commodities face rising demand and tightening supply – and that’s not about to change soon. Tim Bennett and Eoin Gleeson look at ten minor metals that could give you anything but minor returns Regular MoneyWeek readers will know that we are big fans of commodities in general and precious metals in particular. But while investor interest in gold, silver and even platinum is growing steadily – witness the launch of a batch of preciousmetal-tracking exchange-traded funds last week – some of the biggest profits of the next few years could be made in metals you’ve probably never even heard of. The so-called minor metals do not enjoy the same profile as their more glamorous cousins, but they have been huge beneficiaries of the commodities supercycle – some have seen their prices jump more than tenfold in recent years. Most have a variety of uses, but the drivers are rising demand for electronic goods from Asia’s emerging middle class; the upsurge in ‘green’ technologies; China’s insatiable demand for steel; and the need for industrial users to find substitutes as more commonly used metals such as nickel also soar in price. With growth in Asia, and China in particular, showing no signs of slowing, these forces seem unlikely to diminish in the near future. Here are ten minor metals we think you should know more about, with tips on how you can profit from them. Cobalt (Co) Atomic number 27 One beneficiary of the drive to go green is this silvery metal. In the past three years, cobalt use in rechargeable batteries has risen by 284%, the fastest-growing segment of which is hybrid electric vehicles (like Toyota’s Prius), which cut air pollution and fuel consumption by at least 50% compared with an ordinary car. Most such vehicles now use nickelhydride batteries, which contain about three to five pounds of cobalt, but use of more sophisticated lithium-ion batteries is set to rise – and the good news for cobalt producers is that these contain five to seven pounds of the metal. Another big use is in mobile phones and jet engines, where despite rising prices, engine makers have difficulty in finding substitute metals once a product has been designed and tested. In the past decade, consumption of the metal has grown at an average annual rate of 12.9%. Credit Suisse reckons the price could spike from the current $30 a pound to $40 by the end of the year, driven by “new demand from emerging markets such as China and India, where the launch of low-cost airlines in air travel and mobile phone usage are set to multiply among an expanding middle class”. US government stockpiles of the metal and lower-grade material from the former Soviet Union are now largely depleted, leaving little inventory to draw on. “Once the market becomes more educated about cobalt, watch a flood of capital flow towards the very few publicly traded primary cobalt companies available to investors,” says Richard Reinhard for Growth Stocks Weekly. He likes Formation Capital Corporation (TSX:FCO), which after 10 years of exploration and development is about to see its cobalt project in Idaho come on line; and Geovic Mining (TSX: GMC) another cobalt-focused miner, which is still developing its open pit cobalt-nickel deposits in Cameroon. Rhodium (Rh) Atomic number 45 Another metal benefiting from green concerns is rhodium, a silvery-white byproduct of platinum production. Its key use – accounting for more than 80% of demand – is in diesel catalytic converters, which cut exhaust emissions. Global demand is soaring as governments tighten laws on vehicle emissions, particularly in Europe – and even though you don’t need much, John Lewins of Platinum Australia says: “There isn’t a substitute. You have to put rhodium into those catalytic converters.” Standard Chartered’s metal analyst Tariq Salaria says: “In recent years, supply has not been capable of matching the increase in demand,” which has seen rhodium rise 14-fold in the past four years to $5,700 an ounce. Merrill Lynch and JP Morgan Chase expect it to rise another 25% this year. Merrill likes Anglo Platinum (JSE:AMSJ), the main producer. You might also look at Norilsk Nickel (OTC:NILSY), which has just received a new licence from the Russian government to ship rhodium and other platinum group metals. Ruthenium (Ru) Atomic number 44 Ruthenium, a fellow platinum group metal, has seen its price soar from $35 per ounce four years ago to more than $600 – and 350% of that gain has occurred since September 2006. Analysts attribute the recent price surge to the metal’s new role in increasing hard disk capacity – a tiny layer of the metal (what IBM scientists call “pixie dust”) allows a computer memory to hold at least four times the amount of information. But ruthenium is a versatile metal – it’s also crucial to higher-capacity mobile phones, while titanium (see below) becomes 100 times more corrosion resistant with the addition of just 0.1% ruthenium. Produced primarily in South Africa, its market is illiquid and prices volatile. But new applications are being discovered all the time – biotech group Medical Marketing International (LSE:MMG) is using it to develop lung, colon and ovarian cancer treatments. Investment bank UBS says: “Although supply will increase in the next few years as South African platinum group mines increase output and recoveries of ruthenium, the market looks set to remain tight.” Business Day tips Anglo Platinum and Implats (JSE: IMP), another South African platinum miner. Indium (In) Atomic number 49 This soft silvery white element, with the unnerving characteristic of producing a sound like a scream when bent, is built into “a billion consumer devices a year”, says New Scientist. The metal is used to create thin-film coatings for the LCD screens used in flat-screen monitors and televisions. These are all seeing strong sales growth as Asia’s developing middle class buys more consumer goods – according to market research firm iSuppli the global electronics manufacturing industry is set to grow in value from $147bn last year to $183bn by 2009. Supply is tight – mine reserves are limited to a few plants in Belgium, Japan and the US, and some estimates suggest these could run out within five years. Demand outstrips mine production and capacity, says Luke Burgess of Goldworld.com, which explains why in the past five years indium’s price has jumped ninefold. He suggests taking a look at small-cap indium explorers Avalon Ventures (TSX: AVL) and Niblack Mining (TSX: NIB). Tantalum (Ta) Atomic number 73 What do capacitors for mobile phones, laptops and playstations, pacemakers, hearing aids and bone replacements all have in common? The answer is tantalum. While young consumers snap up electronic goods, their elderly peers need more and more medical devices, which means demand, expected to grow by about 7% a year, according to the US Geological Survey, is solidly underpinned. Meanwhile, the US Defence and Logistics Agency, which was selling about 500,000lbs of tantalum a year from Cold War stockpiles, sold the last of its reserves in December. Global supply is now dominated by three countries: Australia (62%), Mozambique (14%) and Brazil (11%) and hampered by cutbacks at the biggest producer, Sons of Gwalia (ASX:AGW), which accounts for more than half of global production. Investors keen to get exposure to the metal could look at Aim-listed Gippsland (LSE:GIP). Resource Investor reckons that the potential from its stake in the Egyptian Abu Dabbab mine has been significantly underestimated and that the stock could double in price. Another Aim firm, Noventa (LSE:NVTA), has seen its share price rise by around 25% since listing earlier this year. It has promising opportunities in Mozambique and is headed by ex-Bateman Holdings chief executive John Herselman. Chromium (Cr) Atomic number 24 Nickel is a key ingredient of stainless steel – but finding a substitute has become a concern for steelmakers. The price of the metal has hit record highs, trading at around$47,000 per metric tonne, amid soaring demand for steel to fuel China’s building boom. With recent estimates from metals research group Roskill suggesting that global steel output will rise by 25%by 2010, there’s little sign of relief in sight. Posco, the world’s fourth-largest steelmaker, aims to boost output of nickelfree steel fivefold next year, using chromium, which trades at $7,650 per metric tonne. David Fuller of Fullermoney says: “If chromium is a realistic substitute, the strength of nickel could help to push it to higher levels.” However, there are few pure plays on the metal – Brazil’s FrebasaFerro Ligas Bahia looks the best, but is not easily available to UK investors. However, Xstrata is a big producer of the metal (for more, see box overleaf). Bismuth (Bi) Atomic number 83 Another metal that has left producers struggling with rising costs is zinc, which has hit $1.69 a pound in recent months – good news for bismuth producers. Using a tiny amount of the metal in galvanising can reduce the amount of zinc needed for the process by 30%-50%. Another factor driving the price higher is its use in leadfree solder, which is gaining ground as European regulations eliminate lead from electronics solders. Supply has also been squeezed, after China imposed export tariffs due to its own rising need for the metal. That has pushed the price to $10.85 a pound, twice the level of six months ago – but if zinc remains at current levels, the price of bismuth could go much further. Canada’s Fortune Miners (TSX:FT)has discovered sizeable reserves of bismuth at its NICO project in the Northwest Territories. Molybdenum (Mo) Atomic number 42 “Moly” as miners call it, is the “wonder metal of the oil, gas, nuclear, coal and desalination industries”, says The Daily Telegraph. Prices have jumped tenfold in just a few years, but could have much further to go. That’s because moly is an important ingredient of high-strength, erosion-resistant steel used for missiles, aircraft parts, and – in particular – pipelines. Projects that look set to keep demand rising at a projected 6% a year include 100,000km of oil and gas pipelines waiting to be be built across the Baltics, Russia, China and Canada, plus huge pipeline replacement programs, like BP’s in Alaska. On top of this, nuclear reactors need 7% moly in the core, while corrosion-resistant pipes for desalination plants need 6%. There is plenty of moly ore around but Resource Investor estimates that global smelting and refining capacity is almost fully utilised. In the US, production has been hit by the environmental lobby, while China’s share of global moly output has fallen from 29% to 17% after a crackdown on pollution. Small wonder Ambrose Evans-Pritchard in The Telegraph reckons you should “pack a little moly into your pension fund”. Moly miners don’t come bigger than Blue Pearl Mining (TSE: BLE). With 5% of global output it is the “world’s largest publicly traded moly pure play” and looks reasonably priced on a p/e of 10. Canada’s Sprott Asset Management has launched a moly ETF, Sprott Molybdenum Participation (TSX: MLY), invested 75% in moly shares and 25% in the metal itself. Titanium (Ti) Atomic number 22 Light, strong and corrosion resistant, titanium is a darling of the aerospace industry as airlines seek to cut fuel consumption. Demand from these users coupled with capacity constraints at the crucial melting stage of production have seen prices near-double in the past two years, while recent estimates from Macquarie Bank suggest titanium alloy consumption will double in the next 10 years. As a result, Bank of America sees the earning power of suppliers being boosted for another three years with “little investment into increasing supply”. Chris Olin at Longbow Securities believes the price will also be supported by “huge penetration into the oil and natural gas market”. Deep water platforms require a metal that is weather resistant and durable, making titanium an increasingly attractive alternative to steel. Mirabaud Securities tips Kenmare Resources (LSE: KMR), which accounts for 6% of titanium dioxide output (one source of titanium) from its Moma mine in Mozambique. Analyst Kuni Chen favours Titanium Metals (NYSE: TM)– less than half of forward sales are tied to fixed-price contracts, giving it more scope to profit from rising prices. Olin likes RTI Metals (NYSE:RTI), a titanium producer and component maker. Vanadium (V) Atomic number 23 “Every human on the planet uses vanadium in their everyday life but few investors are familiar with it,” says Resource Investor. The metal is used to strengthen steel, create the best titanium alloys and to develop plastics, glass and dyes. Demand has risen by around 6% a year over the past three years. Crucially, the Chinese only use the metal at 50% of the intensity of western producers, which should help drive growth. Combine that with the fact that primary production in South Africa is close to capacity and the outlook for prices is good. Broker Patersons likes Precious Metals Australia (ASX:PMA), which controls the 5,000tonne capacity Windimurra mine. Its estimated long-run production cost of about $8.60 per kg leaves plenty of profit potential at current prices, which are expected to stabilise above $20. Casey Research prefers the combined vanadium and uranium producers such as Uranium Power Corporation (TSX:UPC) or Energy Metals Corporation (TSX: EMC). China’s construction boom will be good for metals “Pack a little moly into your pension fund” ©BLOOMBERG The most sensible way to invest in a volatile sector With the exception of molybdenum, for which an ETF is available (see overleaf), minor metals are not easy to invest in directly. Markets are often small and illiquid, with deals done directly between miners and users, which means prices are volatile and not always straightforward to monitor. It’s also important to remember that unlike precious metals, such as gold and silver, the prices for the likes of cobalt and bismuth are dictated mainly by industrial rather than investment demand, which means they are also more vulnerable to a downturn in the global economy. This risk can be offset to a certain extent by looking at the range of applications for a metal. For example, many of the metals listed here, including chromium and molybdenum, depend greatly on a healthy steel industry – so problems in that notoriously cyclical industry are likely to hammer prices. On the other hand, metals with a wider range of applications, such as tantalum, should be better placed to weather changes in the economic environment, even if one sector runs into problems. Substitution is another factor to be aware of – if nickel or zinc prices fall, then chromium and bismuth may not look as attractive to users. Metals which cannot be easily substituted, such as cobalt and ruthenium, are less likely to find themselves obsolete or overpriced. Perhaps the most sensible thing for investors to do is to diversify their exposure to minor metals. David Fuller of Fullermoney, for example, prefers the less-direct exposure offered by the likes of AAnnttooffaaggaassttaa ((LLSSEE:: AANNTTOO)), AAnngglloo--AAmmeerriiccaann ((LLSSEE:: AAAALL)) and XXssttrraattaa ((LLSSEE:: XXTTAA)). Xstrata in particular gives solid exposure to a number of the metals in this feature – it accounts for a third of global vanadium production; chromium is its fifthlargest metal by production; and it also has some exposure to molybdenum. Trading on a forward p/e of 8.7, it looks good value to us. Fuller also tips the MMeerrrriillll LLyynncchh WWoorrlldd MMiinniinngg TTrruusstt ((MMLLWW))as a solid diversified bet. It offers some molybdenum exposure, but without the volatility. The trust currently trades at a 9% discount.
  4. Why Are Junior Miners Underperforming?, Will This Change? : chart/added ============================================= Many here and eslewhere have been deeply frustrated watching the gold price rise while their junior miners decline or stagnate. Even producers such as Capital Gold are trading at a discount to where they were when gold was $700. This company has done nothing but get into production quickly. Explorers and developers have been proper dogs, even though the underlying asset has flown. We have seen a 40% rise in gold and barely a move in juniors, in fact declines in some. Why is this? Were they overvalued before? I don't think so. Is it because the market doesn't believe the move? Is it because nobody wants to take any risk? Even some senior producers have lagged. Please post some suggestions as to why this has happened - and some arguments as to whether this will change or not. My first suggestion is the ETF. Why take individual company risk? Why even bother doing any research when you can just buy GDX or GLD? If you want leverage, you can just trade options on said ETF. I think the ETFs have taken huge amounts of capital that would otherwise have gone into juniors - capital that pushed them higher in previous moves when the GDX didn't exist.
  5. A company interview with Argonaut, Morning All, We have some new FB&Bs coming up over the next few days. The first if them is a company interview with Argonaut, about the only gold stock to have risen these last 18 months, and it's here - http://media1.podbean.com/pb/20182f715cc56dc32520419fd32f4a91/4fc89319/blogs/2516/uploads/AR.mp3 http://commoditywatch.podbean.com/2012/06/01/peter-dougherty-of-argonaut-gold/ More to follow. Cheers.
  6. Central LONDON Property: Databank & Charts / for Data see Post #2, and #116 "Never goes down" - except when it does ================================ / Key : Red= Rightmove, Greater London, Green= Knight-Frank Prime Central London / : Data in Post#2 (Here's the Original Post from Cuthbert Calculus) AGENT SPINS - Selling his Fund, as the Market Approaches its 2007/8 Top ============ Evening all, As posted on HPC - THIS EMAIL arrived this evening from EAs Douglas and Gordon. Several things amazed me about it: 1. That they are sending it out to everyone in their email database (to me that suggests things are bad, otherwise they wouldn't need to) 2. The sheer bullsh*t and poorly researched laziness of some of their arguments. Anyway here it is. I look forward to your thoughts - and the tearing apart of some of their arguments: There is a lot of talk in the press about what might happen to Prime London property prices over the next few months. We, at D&G, thought you might be interested to read the views of the Fund manager of the only regulated and open ended Fund that specialises in investing in Prime London residential property -The Prime London Capital Fund. For more information on the Prime London Capital Fund which allows you to invest in Prime London property for as little as £10,000 either call 0207 9634622 or e-mail at info@dngam.co.uk or have a look at the website www.dngim.com Ivor Dickinson, Managing Director / Douglas and Gordon === === === Is the Prime London party over and/or will the USA housing crash affect Prime London prices? Summary 1 The Prime Capital London ( PCL ) market is quite distinct from the rest of the UK property market, let alone the USA one; 2 The areas in USA where prices are falling fastest, and where we have been warning since Q1 that UK prices will fall too, is where there have been recent large increases in supply of housing stock; 3 Supply in Prime London is diminishing, not increasing; 4 In next three months it is possible that, compared to the first and second quarters, demand will soften in Prime London for all but the very best stock. As price increases pause and the press write about the PCL party being over potential sellers will retreat, leading to stock shortages in first quarter 2008; 5 Demand for best PCL stock likely to remain strong; 6 City bonuses likely to be slightly down on expectations of a few months ago but still strong ( those paid in their Bank's stock are likely to get that stock at very good price ); 7 UK interest rates likely to be coming down by 2nd quarter 2008; 8 Next three months presents good buying moment for investors in PCL with 5-7 year time horizon; 9 The value we are adding to the current portfolio ( refurbishment and/or improving lease quality) will not be fully reflected in the unit price until March 2008; 10 Rental market still strong -gross yields of 4% still achievable target for the Fund's properties. 11 The Prime London Fund performance this year / compares favourably to UK commercial Funds ( source : Sunday Times July 15th ) : - Prime London Capital Fund : + 7% ( since Feb 2007 -launch ) - Scottish Widows SWIP......... : -19.5 % - New Star Property Fund....... : - 5.1 % - Aberdeen Property Share...... : -16.2 % - Norwich Property................. : - 4.6 % 12 Sound fundamentals supporting the London economy. === === What lessons can one draw from the USA housing market situation? Firstly, all property investment, like politics, is local. In the USA some regions are suffering, others continue to grow. Of course, in any huge and diverse economy, like the USA, different regions will be at different stages of their economic cycle and that tends to be reflected in local house prices. What is different about this US housing cycle is (a) supply, (cool.gif rising insurance premiums, © the sudden and dramatic move up in US interest rates. In the USA it is " sub-prime " mortgages that have attracted all the headlines. But it is important to draw a distinction between the effect that these loans have had/will have on the financial markets and the cause of falls in median USA house prices. In terms of the USA housing market these sub-prime mortgage problems are tiny. The root cause of falling prices is a dramatic increase in supply, and it is a reminder, once again, that when trying to make money out of property supply uncertainties are the major headache for any investor. 1 The US mortgage market is worth $10,400 billion; 2 13% of that ( $ 1,350 billion ) has been lent to " sub-prime " borrowers; 3 14% of that 13% is delinquent ie the mortgagor is late with payments or has defaulted -so less than 2% of the total USA mortgage market is affected to date; 4 About 5% of that $1350 billion is in foreclosure ( $67 billion ), of which half is likely to be recovered; 5 Known losses so far are therefore about $33 billion; 6 That represents about 0.047% of the USA total national wealth. So, our observation would be that the current malaise in USA housing is less down to the sub-prime lending per se but more to the fact that there is an unprecedented overhang of inventory ( source : Joint Center for Housing, Kennedy School of Government, Harvard, June 2007 ). Median USA house prices have fallen because of very large drops in those specific areas ( eg the South and South East ) where supply has been greatest. This has dragged down the national numbers. The " median " USA house price is that number where 50% of all USA houses cost more, and 50% less, than this number. It is not the average price. When there is a big overhang of stock ( up to 1 million units -see above report ) that hugely increases the numbers below the old median, and so the new USA median house price falls significantly. This tells you little or nothing about what is happening to the value of houses above the old median. As ever, statistics can be made to tell you anything but the moral is - average/median/index house prices are virtually worthless when it comes to assessing the strength and/or the outlook for prime areas where the supply/demand dynamic is totally different. The second, less-commented upon contributor to the fall in median house prices in the USA -insurance premiums. Since Hurricane Katrina ( 2005 ) household insurance premiums have risen by 300% in the very same areas where the supply of housing stock has been greatest ( the South and South East ). This has added hugely to the entry cost of any new home buyer and has meant many have been unable to enter the market. Thirdly, do not under-estimate the extent of the monetary tightening that has taken place in the USA. In June 2003 Fed Funds were at 1%, by June 2006 they were at 5.25 %. This is a 425% rise in USA interest rates in three years. Conclusion ========== If I told you that the average number of goals conceded by football teams throughout the English professional leagues was 1.5 a match would that be a helpful statistic when trying to work out how many goals Chelsea were going to concede per match this year? Of course not. What happens to football teams in the fourth division has no relevance to what happens to Chelsea -they are, effectively, playing a different game by different financial rules. Why do people continue to think that what happens to the general UK housing market, let alone the USA market, is relevant to what happens in the Prime London market? They are as different as the said football teams, perhaps more so. There are many differences but the big one is supply. In Prime London there is not only no extra net residential supply coming on stream but, arguably, supply is diminishing as flats get knocked into bigger flats or houses. That is what makes the PCL residential market totally different from the rest of the UK and it is why the USA example should be a reminder to investors that, in a mature market, demand will fluctuate to some extent during different parts of the economic cycle but what really disrupts/destroys property investment returns are supply shocks. If you can rest at night because there is no risk of further supply, as you can with PCL, that makes life a lot easier. This differentiates PCL residential property investment from not only the rest of the UK housing market, but also the London commercial property market where large amounts of fresh supply look like spoiling the London commercial property party for the next couple of years. So do you think Prime Central London average prices will fall over the next quarter or two? It is not our central forecast but it is possible that the Savills PCL Index could show a small decline over the next two quarters. That should not unduly worry investors in the Prime London Capital Fund. The Fund is a " stock-picking " Fund and picks the best properties from within the PCL universe. The properties within PCL that are most likely to show price declines will be the " sub-prime " ones ( basements, walk-ups, ones on busy roads, new builds ). The Prime London Capital Fund looks at about 30-40 properties before it makes an offer on any one and has done so since we launched. By definition, the properties we have rejected/failed to offer on we think have been overvalued, and it is these that could show some small capital decreases over the next six months. But, the best stock will remain in demand and will continue to get top prices and, as potential sellers react to talk of a softening sales market, so stock will dry up again. Once again, it all comes back to supply in PCL and we expect that to dwindle even further over the next six months. The next couple of months will be a good time to buy PCL stock if you are a long term investor. Why are you so confident? History. Over the last 20 years when there have been financial market jitters potential sellers of Prime London pull their stock, leading to supply problems..and, after a pause, a continuation of the long term trend growth ( + 9% p/a ). 1 1994 - Mexican devaluation crisis. PCL - March 1994-March 1995 : + 19.2% - March 1995-March 1996 : + 3.2% ( slowing but still positive growth ) Due to the slow-down in growth during 1995/96 stock was pulled leading to a rise of + 13.6% for period March 1996-March 1997. 2 1997-1998 - Russian and Long Term Capital Management crises PCL - March 1997-March 1998 : + 23.8% - March 1998-March 1999 : + 2.9 % ( slowing but still positive growth ) As in 1995/96, the slow down in capital growth in 1998/99 led to stock being removed from market leading to rise of + 23.3 % for period March 1999-March 2000 3 2000 bursting of tech bubble PCL - March 2000- March 2001 : +15.2 % - March 2001-March 2002 : + 6.8% ( slowing but still positive growth ) The pattern continued - slow down in growth in 2001/02 led to supply shortages and capital growth for the March 2002-March 2003 period was + 9% 4 Finally, September 11th 2001/Enron collapse 2002 PCL - March 2003- March 2004 : - 0.6% - March 2004- March 2005 : + 2.5% After these, relatively, slow years stock diminished and period March 2005-March 2006 was + 4.4%, and March 2006-March 2007 + 22%. Conclusion ========== What no-one can predict is when (a) the slow down in growth rates will take place, and (cool.gif when the next big + % year will be. What can be observed from the last 20 + years of PCL price action is that when the slow down occurs (a) it is likely to be a slowing in growth rates, not an actual decline, (cool.gif any slow down soon affects seller sentiment and thus supply levels, leading to © a demand-supply imbalance and a resumption of long trend growth. The time between (a) and cool.gif and (cool.gif and © is anyone's guess. The risk of not being invested for the © leg of the process ( ie the big % year ) is clearly greater than the risk of investing in a year of sub-trend, but still positive, growth. Of course none of the above takes into account rental yields which tend to rise at times of capital growth slow-down and make a significant contribution to total returns ( which have not had a negative year since 1992 ). So what about units in the Prime London Capital Fund -where will they go over the next few months? I am restricted from making any hard and fast forecasts but what I can say is that we are in the midst of adding, we believe, significant value to some of our properties. We will be spending capital to improve the look of the estate and/or improving the quality of the lease through lease extensions. We expect the added value in the units to be fully reflected in the price of the Fund's units by March 2008. There are, at least, a couple of dealing days ahead of March 2008 and the intention is to move the Fund to monthly dealing next year. Wouldn't it make sense to wait a bit before entering the PCL market? If you can pick the highs and lows of any market, let alone the PCL one, you don't need us. Nobody knows for sure where prices are heading and what the outlook will be. What we can say with 100% certainty is that the lesson of the last 30 years in PCL is that the longer you have been invested in the market the more money you have made. We have been buying, selling, investing, managing Prime London properties for nearly fifty years and there are far more examples of people regretting that they delayed buying or getting out of the market than there are of people who have successfully sold at the top and bought at the bottom. The strategy of this Fund is not to trade -we are not pretending to know when the top of this cycle will be ( although on an historic basis there is at least another 100% in capital increases to go in this cycle which started in June 2003 ). We are an investing Fund looking for quality and value and we will leave calling tops and bottoms to others. We will get on with seeking the best Prime London stock, improving it and making it sweat a steady 4% p/a gross yield. Isn't one of the lessons of the USA-led financial market volatility that now is a time to reduce risk? I would put it differently. The events of the last month are a salutary reminder that you should always invest in things (a) you understand, and (cool.gif where the risk is transparent. The extraordinary aspect to the current bout of market jitters is that the so-called financial market experts did not understand the risk they had bought. Many, apparently, thought they had triple A grade debt but it turned out they didn't. The risk profile of the Prime London Fund is easy to understand and transparent : 1 We invest only in the very best residential Prime London real estate; 2 We borrow, on average across the portfolio, 50% of the purchase price; 3 Our net yield from the rent more than covers our mortgage payments; 4 We seek to improve the underlying asset through refurbishment and/or lease improvement; 5 We are seeking long term p/a total returns of 9%. This is made up of 6% capital growth ( long term average for the PCL index is 9% ), and 3% net yield; 6 We will never be a forced seller of the underlying assets because the Fund will never have to redeem more than 8% of its NAV in any one year. Our strategy is a simple one and our borrowing is modest. The trick comes in (a) getting access to the best stock, and (cool.gif acquiring it at the right price and that is very labour-intensive. That is what you pay your Fund manager to do for you, and to make sure that the assets are improved and made to sweat. But there are no hidden complications and the model and the Fund is straight forward and transparent. The moral of the recent USA " crisis " according to the great Mr W Buffett is " don't fear risk, make sure you understand it ". Is the growth in PCL based on a secure economic footing? The financial and business services sector of the UK economy doubled between 1980-2007 ( from 15% to 29% ). In London the sector went from 20% to 42% of the region's economy over the same period. This sector of the UK economy grew by 10% in the year to the first quarter 2007, compared to 2.8% growth for the rest of the economy. In London 28% of the workforce is in this sector. In short, the importance of financial services to the UK economy is huge as is the centrality of London to that sector. No Government will risk the pre-eminence of London to the UK financial services sector and that is why the Prime Minister, and his right hand man Ed Balls, have resisted calls to revisit the tax status of private equity and wealthy overseas non-domiciled residents as well as insisted that they will work to continue to make the City the financial centre of choice ( see attitude of FSA vs SEC to markets regulation ). They know that it is these high earners who can decide where to base Fund management and Private equity firms, and if they leave London it will have a serious impact on tax revenues. As for the future, the consensus is that economic growth in London will out-strip the rest of the UK by up to 1/2 % - 3/4 % p/a every year for the next decade ( source : Cambridge economics ). There are also the planned infrastructure projects associated with the Olympics. So, future demand look set fair. What do other market participants thinks this all means for the future of PCL prices? One of the joys of being a residential property Fund manager is that everyone is a property expert. The press love to write the story about " booms " and " fat cats " and then "busts" and " pricked balloons ". Remember the press need to sell newspapers and so there is no point in a property page sub-editor being understated when he prepares the headline for the next property story. Over the next few months it is quite possible that the press turns on the housing market in general and the Prime London market in particular. This could well have the effect of scaring off marginal sellers in Prime London, reducing supply ( see above ) but have little or no impact on the competition for the best properties, except maybe there will be 3/4 after each rather than 8/9. On a longer term perspective, investment bank Investec undertook some research in August 2007 and found that over half of all London agents thought that, within two years, £4,000 per sq ft would be common place for the best stock. The Fund is currently buying the best stock for between £1100-£1600 per sq ft. For more information on the D&GIM Prime London Fund please either call or e-mail me at the number/address below and/or go to our website www.dngim.com ==== ==== Link to Here----- :: http://tinyurl.com/GEI-london London Population :: http://www.londononl...ile/historical/
  7. Here's an interview with Keith about the IPO: http://commoditywatch.podbean.com/e/keith-neumeyer-first-mining-finance/ http://www.podbean.com/site/UserDownload/index/bid/2516/url/http%253A%252F%252Fcommoditywatch.podbean.com%252Fmf%252Fweb%252Ff4ucxq%252FKeithNeumeyerFirstMiningFinance.mp3
  8. Of these alternative information sources and rumours that have been cited over the last, say, five years - many preducting some kind of extreme event or huge revelation - which have actually happened? I'm trying to get an idea of the success rate.
  9. Barratt to be kicked out of the FTSE 100 http://www.cityam.co...lides-down-list
  10. Thanks Doc. The news is basically increased resources and production (hoped). I'm interested in that trend line you have drawn - how did you arrive at tht?
  11. Afternoon Dr, I'd be interested to know what you make of this chart - a tiny little oil producer called KFG. I think the lack of volume is interesting - but I'm not sure what to make of it.
  12. Ten ways to be an effective political activist, in a roughly decreasing order of importance: 1. Be prepared to vote with your feet. Add interstate and international diversity to your social networks -- both personal and business. Lower your costs of exiting, if the need should arise, the jurisdictions that impose on the territories wherein you reside. Repeatedly in history -- from the old American frontier to the fall of the Berlin Wall to modern jurisdictions that specialize in international trade -- low exit costs have not only enabled liberty for the individual and the small group, but they have more than any other factor motivated the larger jurisdiction to provide the most important rights and freedoms for those who stay put. Grow interpolitical roots so that no single polity can chop down your tree. The good news is that modern communications, travel, and standardization of international languages (mostly on English) have made diversifying our social networks -- growing international roots -- far easier than ever before in history. 2. Influence our law in action. Serve on a jury and insist on protecting those who have not been proven to harm or intend to harm another. 3. Make your own law. For starters draft your own contracts, wills, prenuptial agreements, and property deeds. Even better if you can do this as a service for other people, but for that you will generally need to be a member of the appropriate legal guild. To draft law usefully, whether for yourself or others, you will need to learn the real law they don't normally teach in public schools: contracts, property, trusts and estates, and torts for starters, or else (often a second best choice to learning law yourself) retain the services of a sympathetic lawyer. Learn actual law -- don't turn into a whacko running around putting liens on other people's property based on interpretations of the UCC quite remote from what any judge would contemplate. But do start to make your own law. You cannot be free if you cannot make your own law. 4. Influence our law in action. Donate to or get involved with the Institute for Justice and other organizations of politically and legally savvy people defending our most important rights and freedoms in the courts. 5. Make your own law: use strong security to protect the people, relationships, property, and data you value. Learn to defend yourself and your loved ones with weaponry. Write and use cryptography, smart contracts, bit gold, digital cash, and other security protocols made possible by computer science. 6. Tell us about your good research and good ideas: write a blog, comment on a blog, write papers. 7. Start a multinational small business. 8. Vote with your pocketbook -- buy and sell the goods, services, stocks and bonds that promote liberty, and boycott those that promote its violation. 9. Get involved in a lobbying group or political campaign where you can make a difference: usually a local campaign, but on rare occasions a national one. 10. Vote for and against politicians, but don't be fooled -- of all these ten ways to make a political difference, voting in a political election makes the least difference. From here - http://unenumerated.blogspot.co.uk/2007/08/ten-ways-to-make-difference.html
  13. Where do you think this chart is headed next?
  14. frizzers

    Where's this one going?

    Here are some support levels. Note that 5.80 in 1990 and 2011. I think this is an important ratio to think about at present.
  15. frizzers

    Where's this one going?

    You're not supposed to know what it is as it affects bias - I just wanted to look at the the direction. But yes it's the Dow-gold ratio.
  16. James Turk and the Money Bubble In today's programme I meet James Turk to talk about his latest book, the Money Bubble, written with John Rubino. http://media60.podbean.com/pb/43bb56ae5189d2a28d479831efc964bd/52d7b645/data1/blogs1/2516/uploads/turk.mp3 Download MP3 James is convinced the money bubble is about to burst. I'm not so sure. We discuss. James Turk is a sound money advocate. He is the founder and former chairman of Goldmoney, through which you can buy and store gold. His book, also written with John Rubino, the Coming Collapse of the Dollar, is, in my view, essential reading. http://commoditywatch.podbean.com/2014/01/16/james-turk-and-the-money-bubble/
  17. Dr Bubb interviews Dominic Frisby (on : LIFE After The State) "Money is the blood of our economy... and it is riddled with infection." MP3 : http://media65.podbean.com/pb/18b608bcef10952f2989e0113f032170/52aa055d/data1/blogs1/2516/uploads/mhinterviewsdf.mp3 (26 mins.) We turn the tables this week and Michael Hampton interviews Dominic Frisby about Life After The State. Download here. Please click here to the whole audiobook via Paypal. You can also buy it with Bitcoin. And click here to buy on Amazon.
  18. frizzers


    An interesting table identifies targets for major bear market lows. We never got there ... From the Atlas Pulse newsletter (very good NL by the way).
  19. Ha. I've got a BTC and a worldcoin wallet so either of those.
  20. With perfect timing, DF launches his latest book - on the future of money. I've called it Bitcoin - the Future of Money? . Really, I should have called it 'crypto-currencies - etc', but there is more public awareness of Bitcoin. More here. http://www.youtube.com/watch?v=S-gKmTiEXJU Any help getting it funded would be much appreciated ...
  21. Gold price manipulation? http://commoditywatch.podbean.com/2014/02/05/dimitri-speck-gold-price-manipulation-and-the-gold-cartel/ Dimitri Speck Gold Price Manipulation And The Gold Cartel http://media67.podbean.com/pb/36c4fd934146e79114e9f006e278a90a/52f23fd2/data1/blogs1/2516/uploads/speck.mp3 In today's programme I talk to Dimitri Speck about gold price manipulation and his new book The Gold Cartel: Government Intervention In Gold, the Mega-Bubble in Paper, and What This Means For Your Future. Dimitri Speck is a commodity analyst and chief developer of trading strategies for asset manager Staedel Hanseatic, where he is responsible for the Stay-C commodity fund. Visit Dimitri's website, Seasonal Charts.
  22. frizzers


    Gold price manipulation? http://commoditywatch.podbean.com/2014/02/05/dimitri-speck-gold-price-manipulation-and-the-gold-cartel/ Dimitri Speck Gold Price Manipulation And The Gold Cartel http://media67.podbean.com/pb/36c4fd934146e79114e9f006e278a90a/52f23fd2/data1/blogs1/2516/uploads/speck.mp3 In today's programme I talk to Dimitri Speck about gold price manipulation and his new book The Gold Cartel: Government Intervention In Gold, the Mega-Bubble in Paper, and What This Means For Your Future. Dimitri Speck is a commodity analyst and chief developer of trading strategies for asset manager Staedel Hanseatic, where he is responsible for the Stay-C commodity fund. Visit Dimitri's website, Seasonal Charts.
  23. Talking silver, 43-101and mining with Keith Neumeyer http://media60.podbean.com/pb/7f87fd35abaf1fe0bb143ca6090e3f55/52d433dc/data2/blogs1/2516/uploads/keithN.mp3 Download A fascinating conversation over a pint with Keith Neumeyer, president and founder of First Majestic Silver (TSX:FR/NYSE:AG). We cover the depressed state of mining, the flaws in 43-101, the outlook for silver, manipulated markets and much much more. Keith is a clever and interesting guy, one of the mining CEOs to actually deliver on promises, and this is a recommended listen. http://commoditywatch.podbean.com/2014/01/13/talking-silver-43-101and-mining-with-keith-neumeyer/
  24. Thanks! I just voiced the trailer for the show, not the actual show.