Making Sense of my World

What did I say about Budgets?

2009-05-27T04:58:00.000-07:00

I have not posted in a while, but by February I was seeing a $50 billion deficit and they have only come out and admitted it now.I entered adulthood at the end of the Trudeau era, when the next government inherited a mess where government spending was $39 billion dollars more then tax receipts without considering interest on the debt.I knew nothing but a sluggish economy, grossly declining wages,

Election confusion

2008-09-28T16:37:00.000-07:00

This is one election that I am not looking forward to, indeed, I doubt it makes any difference as there isn't a true leader out there. There are the tax cut and the spending promises, but I have news for you, there isn't more money to spend and thanks to Harper's narrow view Canada's got its first deficit in what, 10 years? When the year is up expect it to be in the range of $6 billion.So

Where Did The Perception That Banks Were Good Investments Come From?

2008-08-04T10:12:00.000-07:00

There is no question that if you look at banks historically you can see the factors that investors promote when looking for a "good" investment. My friend that encouraged me to invest at the time was waiting for a huge market correction. That was back in 2006 and he was already more then half cash. One that he mentioned he wanted to pick up was HSBC, and his price was in the $65 range. The

Harper - Trudeau the second

2008-07-25T10:19:00.000-07:00

Harper's a moron. He is destroying all of Canadian's hard work and saying no to unaffordable spending to make Canada a strong country.Thanks to a moron named Trudeau I entered adulthood in an environment of high taxes and a sluggish economy for years to pay for his excesses.Harper is screwing young people today as much as Trudeau screwed my generation.Congratulations Harper, you managed to undo

Do You Remember Where Your Career Was 28 Years Ago?

2008-06-28T08:19:00.000-07:00

It looks like Big Picture is my favorite blog of the day today. In a post he mentions the 28 year low on sentiment, or I guess 1980.If you are old enough, do you remember where you were in your career 28 years ago?I graduated high school in 1979, and my age cohort was the largest of the baby boomers. Birth rates increased until 1961 and then they started to decline, so I entered the job market

Hudbay Mineral - A $6 stock priced at $18

2008-05-11T17:35:00.000-07:00

I first looked at Hudbay Mineral when I contrasted it to Blue Note just over a year ago. I saw nothing but downside to it, although I wasn't overly critical, yet. Blue Note that I liked has yet to perform, and with the retraction of zinc price it is unlikely to perform. I anticipated a retraction of zinc prices, but simply not to the degree that they have retracted. Zinc was at $1.53/lb and

The Problem With Storage

2008-05-11T10:14:00.000-07:00

The enormous problems in the US housing market has an even sadder story about what to do with your stuff while you try to get back on your feet, as featured in this news story.I put my stuff in storage while I was in university and went to jobs in Ontario and Alberta. What started as a 4 month plan turned into 2 years. It was probably a good learning experience in that I would strongly advise

The Problem With Housing Development Fees

2008-05-08T06:05:00.000-07:00

I have previous written about the unfairness of development fees and now many municipalities find themselves in trouble trying to balance budgets because of their gross irresponsibility in leveling fair taxation.Without going back and pulling actual figures, I know that in my area (and certainly my reading of news from other areas indicates the same problem) the percent of municipal budgets

Aging Population, Canada Vs US

2008-05-05T03:00:00.000-07:00

I was looking around on this census data site. Canada and the US are fairly similar right?Well, what I found kind of shocked me. I started by looking at the US data and I found that the ratio of working age (20-64) to retirement age (65+) people was increasing slightly in the US from around 1995 and that in 2007 the percent was essentially the same. The graph below actually has the US data

Where'd the Dock Go?

2008-05-04T17:42:00.000-07:00

You know those warning sirens you hear in the movies for warning of a bombing raid? Those kind of sirens were going in town today and I didn't know what they were for. They were going for about 30 minutes. I looked around and didn't see anything.Well, the ice in the river broke last night and it brought about 7-10 meters thick of ice filling up the river, and it over flowed the banks for a

Super Artists

2008-05-03T16:20:00.000-07:00

My students are super artists. We are working on a yearbook and I thought I'd share some of the artwork they've made for putting students heads onto. I am in a very small school. We have 5 graduates this year, and the above picture will hold their mug shots.Below is a sampling of other art work that will have student mug shots.The boy who drew this one is in his later teens. He is amazing in

The Pawn Shop Memories

2008-05-02T22:53:00.000-07:00

Mish had a post that hit me hard for how it reminded me of the challenges of my youth.The post features two links, one about how the pawnshop business is booming as people hand over things to get instant cash."We never saw so many people in here 30 and younger," Society Hill associate Damien Robinson said. He spoke as a 22-year-old Neumann College graduate walked out with a $75 loan on her Dell

Sensible Lending Standards

2008-04-26T22:45:00.000-07:00

Sensible Lending Standards - Get more documents

Interest Rates - The Two Faces of Dr Jekyl and Mr Hyde

2008-04-19T20:09:00.000-07:00

Low Interest Rates - The Two Faces of Dr Jekyl and Mr Hyde - Get more documentsThis can also be viewed full screen.

What Can A Housing Bubble Teach?

2008-04-19T14:26:00.000-07:00

What Can a Housing Bubble Teach - Get more documents

I'll Bite, I'll Blog About It

2008-03-22T18:50:00.000-07:00

A line in the song suggested blogging about it...While I'm at it, another wonderful song, Bubbleman:

Flush Tax Money Down the Toilet

2008-03-20T09:00:00.000-07:00

First, my last post is incredibly long, but it is one worth reading and studying, imho. There simply are too many faulty and disasterous beliefs around low interest debt and too much looking at it from a perspective that is so narrow, well, collectively society will be paying for this blatant ignorance most likely for the next generation. I think it is worthwhile to understand how the "experts"

Six Degrees of Leverage

2008-02-27T20:35:00.000-08:00

I wrote most of this a couple months ago, but I've done some edits to update."Pricing-to-market" long term debt or credit is really quite a shocking concept, as the numbers will show, yet this appears to be a common practice.I had a look quick look at the numbers for this and it got me thinking about some bonds my financial adviser had me in. When I bought rate of return to maturity was around

Deflation Convyer Belt

2008-02-24T07:31:00.000-08:00

Counterpunch has an article with a quote I like about the monetary system that is an excellent image of deflation at work: "Imagine a 200 ft. conveyor belt with two burly workers and a mountain-sized pile of money on one end, and a towering bonfire on the other. Every time a home goes into foreclosure; the two workers stack the money that was lost on the transaction, plus all of the cash that was

Backroom Deals

2008-02-23T09:49:00.000-08:00

Calculated Risk has a post about a back room deal BoA is trying to get taxpayers to fund.According to the proposal $739 billion in mortgages are at moderate to high risk of defaulting. So, tax payers buy the mortgages at deeply discounted prices and pay to forgive the debt above current market value and tax payers pay the difference to refinance these borrowers at lower rates.The marketing

Wall Street Is Your Friend

2008-02-17T06:48:00.000-08:00

The Big Picture made a "subprimer" on the subprime mess.If you still don't understand what Wall Street did to create billions of dollars of losses for investors around the world, most likely including your pension fund, have a read.End of post

Stop What You Are Doing Moment

2008-02-09T21:47:00.000-08:00

The financial markets seem extremely unstable. I find the data around what is happening unsettling, yet some of the things you would expect to happen with it seem to defy gravity and remain supported as if by magic.Today I was reading a piece on Safehaven by Peter Schiff and how he describes treasury bills as the mother of all bubbles. He outlines his thesis:"For years I have predicted that the

MacKenzie Gas Project

2008-02-06T17:39:00.000-08:00

To quote directly from the MGP website"The Mackenzie Gas Project is a proposed 1220-kilometre natural gas pipeline system along the Mackenzie Valley of Canada's Northwest Territories to connect northern onshore gas fields with North American markets."The proposal has the pipeline going through about 200km to the east of where I am currently living in the North West Territories. We had a group

Where Are The Regulators?

2008-02-03T08:41:00.000-08:00

I was reading an excellent piece by Nobel Prize winer Joesph Stiglitz on his thoughts on the World Economic Forum. One of the things that he said that is proving to be a lesson that Wall Street sociopaths, morons, idiots, scam artists, con men, swindlers bankers refuse to acknowledge (or perhaps once a swindler always a swindler) that Stiglitz said is:Bankers – and the rating agencies – believed

Gooooogle Grooooowth

2008-02-02T19:23:00.000-08:00

I am of the opinion that Google is full of hype that has sent its share price beyond reasonable valuations. No question the growth story is good, but investor expectations go far beyond reality.I have done a couple posts looking at Google and tried to demonstrate how this growth rate stuff for pricing investments is increasingly nonsense as the growth rate get higher. The example I used

Kraft Squeezable

2008-01-31T19:25:00.000-08:00

Kraft's earnings are out and they got quite the margin squeeze.The sales were up significantly, 10.9%, and there were about 6% shares due to a share buy back, but that translated into zero growth in earnings for 4th quarter and a decline of 12.4% for 2007.Kraft's margin declined by 4.1%. Nine out of the eleven largest commodity input costs are at record high levels. Kraft priced their products

World Economy Slow Down

2008-01-27T19:48:00.001-08:00

I am looking forward to the next stream of financial and annual reports that will be coming soon. I predict that the press releases will focus on the annual earnings and completely gloss over the 4th quarter earnings, which I expect will not be rosy for any base metal company. However, the 4th quarter earning are probably more representative of the company's next quarter earning potential

Updated Links

2008-01-20T20:58:00.000-08:00

The left sidebar of my blog has several frames, starting with who I am, then there are three posts that I consider of my best quality, then in my archive of posts. The "What I've been reading are news, blogs and items that I found interesting that I've added to my blog through Google Reader. I just click "share," and it shows up in this frame.I updated my links today, starting with Mish's blog.

The Food Squeeze

2008-01-20T10:10:00.000-08:00

I was just reading a blog by a writer from Alberta on his views on food inflation, which sent me looking a little closer at what is happening in the industry. It is yet another recession red flag.Liverliss concludes with his analysis: "My point is that we have not seen the impact of increasing grain prices being priced through into consumer food inflation. But we soon will. And when I see

Increasing Whole Sale Prices

2008-01-19T09:15:00.000-08:00

Consider that wholesale prices are up 6.4%. I am not sure the degree to which this is a problem, but I picked two stocks to have a quick look at. McAfee has a market cap of about $5 billion and 160 million shares. My first glance is that the wholesale price increases will hurt them less than other businesses. Their cost of revenue for the last five quarters, starting with 09/06 and going to

My Home Selling Experience

2008-01-18T17:26:00.000-08:00

My husband and I sold our home earlier this month. It was the third home we've sold and this home selling experience was probably the best in terms of the service we got from our Realtor, David Chan.If you are in the Vancouver area, I strongly recommend David. Our home had about 50 potential buyers come through and look at it. David also completely respected our wishes and I always felt that he

The Glory of Ignorance

2007-12-23T09:16:00.000-08:00

We ought to be able to go about our lives blissfully ignorant about many things. For example, I was blissfully ignorant about serious home design problems which in Vancouver led to what we called our "condo rot" problems.I would look at a development and never see the design issues that scream you have to be moron to put this design feature in homes being built in a rain shadow. You would think

Petri Dish Planet

2007-12-16T10:41:00.000-08:00

How much have you factored population growth into your economic beliefs?In first year biology one of the items of study was contrasting world population to bacteria population in a petri dish.The lesson went something like, this is a graph of the world population:This is a graph of bacteria in a petri dish:The lesson ended by showing how the graph ended. I could not find such a graph, but I

BHP - RIO -- Merging Bubbles

2007-12-14T23:46:00.000-08:00

I play CAPS and I am losing on my BHP call and barely holding on my RIO call. I believe both these companies to be highly bubbled values and BHP is courting RIO.BHP has a market cap of about $190 billion and I believe BHP has been artificially sending its share price higher with its share buy back program. I simply see no value for long term shareholders, as I have previously written.I think

Political Idiotism on Taxation, Again

2007-12-02T08:22:00.000-08:00

This topic is a little stale in terms of current news, Government proposes $60B in tax cuts, with further GST drop, but I never got around to writing about it when it was current and it is so negligent and stupid.There is a booming economy. The economy will not always be booming. These proposed cuts will NOT be sustainable with a down turn in the economy. It is one thing for an individual to

Bad Feeling Good Times

2007-11-24T12:04:00.000-08:00

I've been reading some of Jim Jubak's writings and I appreciate his pieces for their deeper understand and broader look at how the world has been changing.His piece, Why these good times feel so bad, gave me a lot to think about.In particular what got my attention was the "The churn in employment,"My Dad, to take an extreme example but one shared by many in his generation, worked for the same

Is Zinc Deleveraging?

2007-11-21T18:55:00.000-08:00

An article, Shanghai Exchange More Than Doubles Zinc Price Limits, describes how the margins for zinc contract have been increased and how price controls have been relaxed, if my understanding of the article is correct.To enter a contract you needed 5% down, but that changed on November 19th to 9% down and it is increasing to 14% on November 22. That is almost three times the margin requirement

Education Hit

2007-11-18T06:10:00.000-08:00

As an educator reading about how school funds are being hit by SIV debt in supposedly "safe" investment pools saddens me.As an educator I would not advise anyone to go into the profession today and I would encourage people to encourage their children to go into other professions that will enable them to have some kind of standard of living rather than an existence. My experience with education

Jones Soda Imploded

2007-11-10T07:44:00.000-08:00

This "earnings" was a six cent loss. That implosion I mentioned was coming certainly looks like it is here.It truly never ceases to amaze me how earnings can be such garbage for a company, yet the share price goes up...So, Jones Soda was down after the last earnings report and then it went back up and now it looks like it is finally on it descent. I thought it was a $3-4 stock before it made

The Pension Bet

2007-11-08T20:22:00.000-08:00

An article I saw today was about the Yukon government investing $36.5 million in bonds that are now frozen and they might see some of this money returned over the next 10 years.I am distressed over the Canadian government's "solution" to the short fall in the Canada Pension Plan. They have set up a system where taxpayers are paying more into the system right now than what is being paid out, and

Currency Contrast of Commodity Prices

2007-11-04T12:07:00.000-08:00

I am Canadian and as such when I look at commodity prices I convert to Canadian dollars. Earlier in the year the conversion meant adding as much as 19% onto the US quoted price yet today it means take 7% off.The change in currency valuation is enormous for the base metal industry. If you look at the mining industry from a world perspective, there are some mines in the US, and for those mines

Chasing Bison

2007-10-28T18:13:00.000-07:00

Never dreamed I'd see kids chasing bison down the street, but that's what I saw today. I wish I'd had my camera ready, but I did get a picture of these two walking out of my front yard about five minutes ago.You can see the top of my car parked next to the house in this one.I have moved to the North West Territories and it has kept me from posting. My internet access is so bad, at dial-up speed

Gold – What’s in a Currency?

2007-10-04T09:29:00.000-07:00

Whether a currency is weak or strong seriously affects buying power. Being Canadian, I have traveled the US when it took $1.50-1.60 to buy one US dollar. It keeps the cost of imports expensive. It helps export businesses and it helps tourism as people from countries with strong currencies see tremendous value in their vacations.Gold is not a currency, but it does act like a form of money, and

Don't Buy Stuff you Can't Afford

2007-10-03T16:50:00.000-07:00

If you haven't seen this Saturday Night Live skit, well, it will amuse you.Don't Buy Stuff You Can't AffordEnd of post

The Abundance of Minerals

2007-09-30T09:21:00.000-07:00

In “Earth for Sale” I did a very rough calculation to determine the values of metals in the Earth’s crust for copper and uranium. The point of the post was that there are such enormous amounts of minerals in the ground, giving value to that which is in the ground at strong prices is imprudent, as that was the only “fundamental” behind the vertical ascent of uranium stocks.This post will look

Par!

2007-09-20T06:16:00.000-07:00

US/Canadian... 1.0006I am in shock...What a joke, everyone put on their born yesterday hats. The US government reported consumer prices fell in August by 0.1%. Energy prices fell 3.2%. I guess no one noticed that crude oil is over $80 month...End of message

2% inflation in one day

2007-09-18T19:27:00.000-07:00

In one day or so the exchange rate for a dollar US went from $1.03 to $1.01 Canadian.Today the US had 2% inflation on imports from Canada, or Canadian exporter to the US just saw their revenue drop by 2%. Either way, it is going to be ugly.End of post.

1000% in 15 trading days - It happens

2007-09-15T12:57:00.000-07:00

Could have, would have, should have...I could not help but notice, after the fact, that a stock that has been on my watch list since last December quite possibly made some kind of stock market record here.Between August 20th and August 27th one could have bought Noront Resources for under 40c/share on the Canadian venture exchange. On September 13th it reached a high of $4.05 and closed at $3.94

Heros - Give Something Back

2007-09-13T17:05:00.000-07:00

One of the most important and significant organizations I've ever known is the Non-Smokers' Rights Association/Smoking and Health Action Foundation. The first is their advocacy part of the organization and the latter is their tax deductible charitable part. I came across a request for a donation that I had put aside and it prompted me to do something about it today.I did anti-tobacco work for

Canadian/US at Par?

2007-09-12T20:25:00.000-07:00

I couldn't help but notice I'm getting US coins back in my change. That was not happening even 3 months ago... US, $1.0375 Canadian. Wow, the US dollar has come down fast and hard.US importers are going to be hurting badly, as will Canadian exporter. I wouldn't want to be owning those kinds of investments through their next earnings reports, or even now...All of a sudden US exports got a

Jones Soda - Lawsuit Joke

2007-09-08T12:00:00.000-07:00

Lawyers have launched a lawsuit against Jones Soda for an "allegation contained in the Seattle Post-Intelligencer that certain officers and directors of Jones Soda disposed of 'nearly all their shares of the company stock' in what was called 'a highly unusual move" by securities experts "during a wave of positive publicity that kept the stock high.'"So now dumb is following stupid...I first

Bottled Water

2007-09-05T06:47:00.000-07:00

The bottled water industry simply put is one of the most amazing the marketing geniuses. In North America we have the highest water standards in the world yet it has developed into a $15 billion dollar industry. And there is no evidence that bottled water is somehow safer, indeed, some have been found to contain harmful things.Something that I had not thought about was the environmental impact

Jones Soda Co - Are We Keeping Up?

2007-09-02T01:38:00.000-07:00

I first reported on what a disaster Jones Soda (JSDA) was going to be for investors back in April, where I showed where the growth in earnings had come and I concluded those items would "murder" earnings in the future.Jones Soda has since had two quarterly earnings reports so it is time to take another look, in particular, the last earnings release.I can hardly get past the highlights:1,722,795

Long Live the Credit Bubble!

2007-08-31T11:35:00.000-07:00

Today Bush announced plans to essentially bail out irresponsible lenders, developers, borrowers, brokers, basically anyone involved with the subprime mortgage mess, as this news release outlines.There are a number of responses, critical as in Mish's post, and I do think Mish is right on with his analysis. I am not sure what to make of "Parting the Bankrupt Sea." He points out that those hurt by

"Panic First..."

2007-08-28T20:14:00.000-07:00

I'm not sure where I read it, but on one of the blogs I read today it said that if you must sell under panic, be the first to do so...I found the post, on Mich's Global Economic Trend Analysis, a blog that I highly recommend be added to all investor's daily reading list. If you look at my reading list on the side tab, I often add these posts to be displayed as what I've been reading lately.End

Checking broker ratings...

2007-08-28T08:14:00.000-07:00

I was looking at a write-up on a few of Meryll Lynch's buy rating at Bespoken.Anyone with any common sense was rating these as sell at that time so you do have to wonder about the hidden agenda.The research shows that investors are consistently better off managing their money themselves and anyone saying that you need an expert is ill informed. You are the only one that puts your best interests

Declining grade of Gold – Are the cost disadvantages linear?

2007-08-25T11:18:00.000-07:00

This is an analysis that I have been meaning to do for a while that simply looks at how mining a declining ore grade affects costs. This is a particularly important analysis for investors of gold stocks as my sense of the market is that the grades of gold being mined are declining faster than any other commodity, and additionally, replacement reserves for gold companies are grossly lower quality

Currency devaluation, social policy - Reflections from vacations

2007-08-24T05:38:00.000-07:00

I just got back from a three week vacation in Costa Rica, where one US dollar gets you about 520 Costa Rican colones.I know little of Costa Rica's economy, except that their main export is from agriculture and their main "industry" is tourism. Currently there is negotiations for a free-trade deal with the United States and every where you go graffiti shows opposition to a free-trade deal with

Copper $1.50 Next Year?

2007-07-29T16:39:00.000-07:00

Some things you read stop you mid-step and send you re-evaluating what makes sense to you. Early I posted that I believe the average price on commodities would be higher than they have been. The evidence shows that companies were cannibalizing their assets to reduce costs when commodities reached their all time low in 2002 and set up a squeeze on supply that has caused on average about a 6-fold

Exploring Declining Grade

2007-07-26T11:05:00.000-07:00

In 1905 the Bingham Canyon mine opened mining a copper grade of 2%. Last year the grade they mined was 0.63% and the reserves they have left to mine have a grade of 0.54%. In 2003 Goldcorp’s Red Lake mine mined a gold grade of 77.5 g/ton, and 28 g/ton in 2006. These are a couple examples of a trend of declining grade in individual mines and within the industry as a whole as the best deposits

Blog Feature - Commodity News and Mining Stocks

2007-07-21T15:07:00.000-07:00

One of the blogs I read regularly is Commodity News and Mining Stocks. Something that I really like about it is that he sends me to look at good articles and reports on the commodity business, and he takes what he learns and applies sound investment strategies to it.Well, a Globe and Mail reporter also liked his blog and has run a story on him.Congratulations Arjun!End of post.

Fantasy Girl Revist - Google Googlplexed

2007-07-19T16:00:00.000-07:00

In the fall I was writing my blog over on Stockhouse and I wrote this 10 part series which I titled Fantasy Girl and a subtitle for each post. Half the posts were taking detailed look at why Google's earnings would not keep up, as in the news story Google's Profit Falls Short, Shares Drop. The other half were looking at Goldcorp and the serious valuation problems with that one for investors.

Subprime, Spending and Lending Laws

2007-07-19T11:47:00.000-07:00

In a news story, Bernanke: Subprime hit could top $100B, Bernanke says that if prices drop consumers could cut back spending as much a 9c for every dollar of lost wealth.So, a half million dollar home declines to $400,000 and the person would cut spending by $9k. A $200,000 home to $160,000 and they would cut by $3.6k.It looks like businesses of non-essential items are going to be in for a

Screening commodity stocks

2007-07-18T12:18:00.001-07:00

I want to come up with a set of rules to essentially screen stock them according to some unwritten criteria that I currently follow. This post is a walk through and see if I can put that screening criteria into “rules” that work for me. So, what have I been looking at?Nord Resources on the Pink SheetsI saw a rumor that Sprott just bought 20% of the company. Often if you can get into a stock at

IXYS - The beginning of an implosion?

2007-07-14T14:16:00.000-07:00

An online acquaintance asked me to check this one out and there were things I found that I did not like.First, from the Mar/07 financial information gross profit, or operating margin, declined from 31.6% the prior year to 24.1%. Consider that an implosion of sorts...The next thing I didn't like was in the year prior the operating margin was $20.4 million yet they managed $30.3 million in

Stealing our Children's Future

2007-07-14T10:19:00.000-07:00

I live in BC. Our news papers this week boasted that tax cuts work because we had a record win fall in a revenue surplus this past year, and it was significant.But, here's the truth as I see it. BC's economy was strong in the past because of our commodity based economy. It died a painful death as mines were closed due to poor commodity prices beginning in the 80s.Commodity prices have been

"White Collar" crime in China

2007-07-10T10:07:00.000-07:00

You know how they warn against taking or doing drugs of any kind in foreign countries because of harsh penalties...Well, a story about the consequences of what we would call white collar crime, accepting bribes, really got my attention today.End of post

Looking at Lead - ADA, BN, BWR, TAM, Zinifex

2007-07-05T18:23:00.000-07:00

Lead has reached an all time high, about 6 times its low since the start of this bull run. It is a strong price, but it isn’t as strong as say molybdenum which peaked about 18 times its low, or nickel, which peaked at around 12 times its low, or uranium which is about 15 times its low. Strong lead prices will mean unexpected profits for lead producers.The market is tight for lead Lead Rises to

I'm a banking bear

2007-07-01T08:14:00.000-07:00

Over on Motley Fool I was asked why I rated Citigroup, a banking stock that is paying a 4.2% dividend and has a P/E of 11.39 as under perform and I thought it a question exceptionally worthy of an answer.I do not usually rate under perform for a stock paying a good dividend and having a low P/E, however, I do not believe any financial institution will ride out the subprime fallout very well and I

Yamana, Northern Orion, and Meridian Gold Merger

2007-06-30T08:30:00.000-07:00

Northern Orion first got my attention last fall when it was trading at about $4 Canadian at the beginning of October 2006, and given its under valuation, the upward march in October made sense. Then it gradually declined, again touching just under the $4 mark at the beginning of January.It was during that descent that I started to contrast how it was being valued relatively in the market to

Bingham Canyon Mine – The World’s Largest Copper Mine

2007-06-19T09:50:00.000-07:00

Mining has a rich history and the Bingham Canyon mine has one of the richest histories. Operating since 1906, it is the world’s first open pit mining operation and it showed the world how to mine low-grade minerals profitably.In 1906 there was a 9000 ft mountain. The mine is now ¾ of a mile deep.In the late 1800s a man named Daniel Jackling first got the idea that perhaps copper could be mined

Looking at the Income Trusts

2007-06-12T20:45:00.000-07:00

Income Trusts - Park Your Money Investments, looked at a list of income trusts on a site promoting them as having very high growth potential, plus a couple that I knew about that had dividend high yields.On a very simple assumption that dividend yields would remain the same and the market would value the trusts equally, I did a calculation on how much they could potentially grow, and made it

Commodity Prices - The 50-year low and 20-year average

2007-06-09T21:01:00.000-07:00

In 2002 commodity prices were at a 50-year low, and with zinc, for example, the price was about half of the 20-year average price.That 20-year average price was mostly in a bear cycle. Bear cycles lead to under investment. Existing mining companies are sustain operations without replacement investment. For example, the mines are already built; so only maintenance costs required. They already

Why Aren't You Saving -- The Death of a Bedrock Belief

2007-06-07T23:37:00.000-07:00

The purpose of Low Interest Rates - As Destructive as Usury was to show how much less empowered people have become in their ability to get ahead by paying down debt through two mechanisms:Grossly reduced leverage of benefit of reducing total amount to be paid back from increasing payments.Low interest rates are because theoretically inflation is low, so wage increases are also low further

Richistan - The Ultimate Conspicious Consumption

2007-06-05T18:50:00.000-07:00

Robert Frank has written a book titled Richistan: A Journey Through the American Wealth Boom and the Lives of the New Rich. There is a link to a radio interview with him about his book that is quite interesting.One thing from the interview is that he is suggesting that there is a lot of consumption coming from these new rich, who got rich from what is referred to as a liquidity event, like

Paladin Resources Ltd - A Near Term Uranium Producer

2007-06-04T22:20:00.000-07:00

On my post on Cameco, which has little ability to take advantage of uranium spot prices because of long term hedge contracts, I was asked about uranium producers able to take advantage of the current spot prices like near term/new uranium producer Paladin.Fully diluted Paladin Resources Ltd has 600,989,245 shares (May 14, 2007). Today it closed at $8.12 giving it a fully diluted market cap of

The Other Eric

2007-05-31T09:54:00.000-07:00

My post, What does Eric Know, was featured Eric Sprott, and basically buying Roca at that time, when the market cap was about 1/3rd of what it is now, could make you lots of money.The other Eric is Eric Schmidt of Google. He just cashed in and sold 57,084 option and sold them on the same day for an average price of $481.97, for $27.5 million.Google is a great company, but it needs to at least

A Closer Look at Two Income Trusts

2007-05-30T21:28:00.000-07:00

Income Trusts - Park Your Money Investments featured a list of trusts from Income Trust Trader as well a few various people have mentioned to me. As of May 25th ITT's list has been updated.They have a little more information, and their Monday post says they compute price trend values based on exponential moving averages and project those forward for a year. Expecting a pattern to continue for a

The Insiders

2007-05-30T21:25:00.000-07:00

Joe_5000 asked an excellent question that is worthy of a post.Where do you get insider trading data?Go to sedi.ca and choose English from the home page.On the Welcome page on the top right corner click "Access Public Filings."From the public filings page on the left side click the yellow menu item "view summary reports."From the summary reports page click the radial dial button titled "Insider

FNX Mining - Cashing in on Nickel

2007-05-30T18:38:00.000-07:00

"FNX quadruples resource base" boasted the press release, and adding up themeasured, indicated and inferred resources gives 1,087 million pounds ofcopper, 1,105 million pounds of nickel and 1,016,000 oz of precious metals.In US prices at $23.23/lb for nickel, $3.34/lb for copper, and $981 perounce precious metal for about $30 billion in today's dollars in the ground,with stellar grades. At

Income Trusts - Park Your Money Investments

2007-05-24T22:43:00.000-07:00

A New Breed of Dividend Paying Companies featured a stock that failed to live up to my theory as to why dividend stocks tend to do better through market corrections -- that investors looking for dividends look for the highest paying dividends.For the next few years in Canada earnings from income trusts are tax exempt if they are paid out as dividends. Some of these income trusts pay out an

The Motley Fool

2007-05-21T23:02:00.000-07:00

I play CAPS on the Motley Fool and I've read many of the articles they post on their site. I find they have some excellent investment tips and they have a goal of helping investors to become better investors.My score for the CAPS game is below. You rate stocks to out perform or to under perform the S&P. You can also have a look and see how the better players choose stocks, and seeing how you

Thompson Creek Metals - Ahead of itself?

2007-05-21T21:39:00.000-07:00

Blue Pearl, aka Thompson Creek Metals, TCM-TSX, has made more than a few investors a lot of money. In the fall of 2005 the share price was at a low of $0.60. Today they have a share price of $16.63 for a whopping 2700% return. Futher, they made 45c/eps in Q1/07. Extrapolate that by multiplying by 4 and add at least 10% for the price of molybdenum going up and you get a rough estimate for 2007

Goldcorp: The Oxymoron of Fiat Creation

2007-05-18T21:00:00.000-07:00

Goldcorp has taught me a lot about what can be hidden in a stock. When I look at the dynamics of what drives a gold stock, the gross irony of Goldcorp is that, from my point of view, it is the epiphany of investor fears that is driving the gold bull in the first place.So, just what are investor fears driving the gold market? The answer I get is currency devaluation due to government just

Low Interest Rates - As Destructive as Usury?

2007-05-06T20:50:00.000-07:00

I was 17 when I first got a job as a teller in a credit union in 1979. This is where I first studied mortgages.Qualifying income was such that no more than 30% of your gross income would be needed to pay the mortgage. Mortgage rates were about 10-12%. You needed qualifying income of $36,345 to qualify for $100,000 of mortgage at 10%. Most mortgages at the time were under $50,000, and people

Looking At Uranium - What a hedge.

2007-04-30T20:51:00.000-07:00

As an investor uranium has made me very uncomfortable. There is no question that there is a huge gap in supply and demand and that uranium mines take longer to get the approval process to build them than other mines, so there should continue to be a gap for some time, but it has all the appearance of a bubble.So, I've been looking deeper into uranium because the spot is very, very, very high,

Quote of the Day

2007-04-30T06:57:00.000-07:00

It is interesting to note that when financial reports show a remarkable increase that is utterly due to unrepeatable events there is little said about what a poor indicator those reports will be of future performance. However, Cameco's president has said it well about how the problems they've had this quarter are a poor indicator of how their company will ultimately perform."Since Cameco's

Jones Soda Co, Breaking Down the Growth

2007-04-28T20:26:00.000-07:00

When I look at a stock I always look at the fully diluted market cap and the P/E first. As of March 6, 2007 Jones Soda, JSDA, gives 25,667,491 shares, Stock Option 1,424,025 (2006 annual report), for a total 27,091,516. Additionally, it appears they have another 1,930,975 options they can issue. Current price as of Apr 28, 2007 is $23.02. That gives a fully diluted market cap of $623.6

The CopperCorp Disaster (GoldCorp)

2007-04-23T07:14:00.000-07:00

"How come Goldcorp is underperforming," I read over and over.Tear into the fundamentals and the changing business dynamics and it isn't hard to figure out. My first post on the over valuation of Goldcorp pointed out many of the reasons why Goldcorp would not perform well.It is time to update.Prior to the merger with Glamis most of the earnings were from copper.The cost of production changed from

Hudbay vs Blue Note, experience vs new

2007-04-20T07:19:00.000-07:00

Hudbay Minerals is Canada's third largest producer of copper and zinc and also produces some silver and gold. They are highly integrated in that they own a copper smelter, a zinc plant and they convert some of their zinc to zinc oxide. Their product is marketed by Considar Metal Marketing, of which they own 50%. Being fully integrated gives them autonomy over the entire process.Fully diluted

What's Up with Zinc?

2007-04-12T08:42:00.000-07:00

I like Blue Note. It is a near term producer starting up in the next month or two.The production plan for the Cariboo Mine is:(x'000)200720082009 20102011TotalZinc68,105 104,467107,748107,03988,816476,175 Lead34,94657,47146,571 44,70839,804223,501Copper 8051,2631,9051,9451,699 7,616Silver8471,3171,055 1,0148865,119Blue Note is ready to cash in on high zinc prices now, and it looks like their

Imperial Metals - The Right Hedge

2007-04-09T10:12:00.000-07:00

Imperial Metals is a primarily copper mining company with other metal by-products. Like Quadra, in 2006 they hedged their copper, only Imperial hedged the right way, protecting earning and minimizing losses.The company did have derivative losses from hedging, about $27 million for 2006, relative to production, that's about 1/5th the loss that Quadra had. In one hedge they protected themselves

Earth for Sale

2007-04-09T10:08:00.000-07:00

Check out the bullboards and complaints about undervaluation of a stock because of the reserve or resource abounds. I've found the metal values in the ground staggering at times myself. So, just what is the value of the metals in say the top 1 km of the Earth's crust? Well, copper makes up about 0.00007% of the

A New Breed of Dividend Paying Companies?

2007-04-07T09:59:00.000-07:00

Historical analysis is clear, very clear, and very strong. Dividend paying companies recovered faster and overall suffered far less losses through stock market "corrections." Some of the reasons for this are pretty clear to me. In general, an investor searching for a dividend paying company is looking for the best rate of return in the form of a dividend. It precludes many investors from ever

Quadra, An Update

2007-04-03T20:21:00.000-07:00

As stated in previous posts, Quadra is going to have big earnings for 2007. Quadra made a hedge on the wrong side and it cost them $144 million in derivative losses. But Quadra is moving forward. They recently entered purchase agreement for a large molydenum property with good grades of molybdenum. The graph shows the size of the Malmbjerg deposit relative to other deposits. The tables

Keep track of dilution - Roca

2007-03-31T16:18:00.000-07:00

I first mentioned Roca back in February when it was trading at $1.35 canadian and had a market cap around $80 million. For a stock expected to have earnings over $50 million for 2007, how could you go wrong?On Friday Roca closed at $2.90 canadian and if you bought when I first mentioned it, you'd be up 115%.You'd think the market cap would also be up 115%, to say around $175 million, but that is

The Leverage of Earnings

2007-03-28T07:42:00.000-07:00

"Around 2000 I left my job and cashed out my pension and put it into commodities," was what a colleague was saying. "I had $14,000 and it is now a quarter of a million."The commodities bull run created an enormous leverage of earnings. Take Northern Orion, a junior start-up company around the beginning of the bull run and now it has $230 million in the bank. The big players have reported

Quadra - When the hedge is over

2007-03-21T08:40:00.000-07:00

Quadra is a $350 million, fully diluted, market cap mining company with a producing mine with 2007 production guidance:125 million pounds of copper,60,000 ounces of gold,no guidance on molybdenum, 260,000 lb in 2006.They have just obtained financing to build a second mine for start-up in 2008, guidance 28 million pounds, increasing to 75 million pounds in 2009, bringing the fully diluted number

Charts

2007-03-19T08:38:00.000-07:00

To refresh the following charts and bypass the cache, which will prevent refreshing, press Shift + Reload.

Blue Note (BN on Venture)

2007-03-14T17:37:00.000-07:00

Blue Note is a little known near term producer. It is building a new mill to commence operations in June and will start mining the ore for the mill in April. The metals are zinc, lead, copper and silver.Blue Note will be a commodity winner due to their choice to develop their mine and cash in on the commodity prices rather than to drill, and drill, and drill their property. An educated look at