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7/27/13

The Pope is having a little get-together on Copacabana Beach, Brazil this afternoon and...

...there's only one phrase that comes to mind on seeing the crowd:



Holy crap! 

Organizers are calling it at three million people. That's a very lot of persons and tomorrow's mass, at the same place, is expected to be the same. 

JJ Cale

A sad day for humans and for music. Featured on IKN a few short weeks ago, the man has left us this morning. 74 is too early.



Way too early. R.I. P., sincere condolences to his loved ones from this corner of the world.

7/26/13

Round Four! The "Friday-Night-Bury-That-News-While-Market-Players-Are-At-Happy-Hour" NR stakes

It's a doozy of a late-nighter from our old friends at Huldra Silver (HDA.v), a stock we were laughing about at $1.50 and the laughs have never stopped, all the way down. Here's the NR and here's how it starts:

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Jul 26, 2013) - Huldra Silver Inc. ("Huldra" or the "Company")(TSX VENTURE:HDA) announces that, after careful consideration of all available alternatives, the Board of Directors of Huldra determined that it was in the best interests of all of its stakeholders to seek creditor protection under the Companies' Creditors Arrangement Act (Canada) ("CCAA"), and has obtained such protection pursuant to an Order from the Supreme Court of British Columbia (the "Court"). The Order and related Court documents are filed on SEDAR (www.sedar.com) under the Company's profile. While under CCAA protection, Huldra will continue attempting to restructure its financial affairs and recommence operations at its mine and mill.
Recently, Huldra has been hampered by equity market, commodity price and operational challenges which lead to the decision to proceed with CCAA protection. Details of the CCAA proceeding will  continues here
It then goes on for a while, but the best line, the crack-me-up-special, comes later:
"Although CCAA protection enables the Company to continue attempting to restructure its financial affairs and recommence operations at its mine and mill until its CCAA status changes, the implications for the Company's shareholders are less clear."

Errrr...no. That's not true, because in point of fact the implications for equity holders couldn't be any clearer. They're truly, totally, royally and magnificently fucked. Bold type, underlined, overpainted with neon yellow marker pen and with a great big capital F at the start of the word to make sure you see it.

Party on Garth.

The Friday OT: Kate Bush; Sunset

A superlative piece of music from start to finish, but a special word needed for the section 1:35 to 2:10 because it makes my insides melt. Ahhhh, Kate...you're the best.



Dedicated to my sister in law Mari, who's a fine person.

Copper sinking this morning

Little doubt that it's the most significant move in the metals world today:


This chart stays centre-radar today.

Peru's mining exports are dropping fast

Here's how Peru's exports since 2011 look:


And here isolated from that data is how the revenues from mining exports have grown year-over-year, same time period:

For those who ask why Peru's currency has been weak against the dollar. The same argument applies to Chile, Colombia, Brazil for that matter. 

Chart of the day is...

...Fortuna Silver (FVI.to) (FSM) 12 month versus Silver Bullion ETF (SLV):



For three reasons:

1) After reading the CotD yesterday reader PG mailed in to mention that FVI is one of the few silver players showing a profit on the 12 month timescale. True dat.
2) Another reader, GT, mailed in an interesting comment that got me sniffing round its financials yesterday evening.
3) As a result we're going to do Fortuna Silver in a NOBS fundamental report on Sunday in IKN221. Should be lashings of fun and after my initial sniffing there may even be a trade here.

So that's my weekend planned, what you do have going on?

UPDATE: Though separately, we must put in a word for this chart, the "Sweet Fancy Moses" formation on the S&P.

PS: Good morning (the view from the roof ten minutes ago):

7/25/13

It's time to help Sinocism, people

Let's begin by saying that if you want in-depth information about China and don't know about Bill Bishop's Sinocism already, then you're missing out. The mailer offered up by the man, free of charge, is a great way of keeping close tabs on what's going on in that vitally important country. Bishop's first-hand and on-the-ground knowledge of China's economic and political scene is second to none.

With that in mind, your humble scribe feels it's necessary to draw your attention to this Tweet, out a few minutes ago:


People, we need to keep this information running which means we need to throw Mr Bishop a few shekels in order to a) thank him for the sterling work he does and b) make sure it keeps flowing. Therefore:

1) Go to the main Sinocism website here
2) Go to the "Support Sinocism" link on the right (or it's linked here for you)
3) Throw the man a little cash.

Frankly, I think it's about time he started to charge for his excellent services, but as it's a free-plus-donate system he's currently operating, then donate we should. 


Blog visitor of the day is...

...International Tower Hill Mines Ltd (THM) (ITH.to):


We note that they've picked up the necessary mail address, however a glance at the inbox says that they haven't mailed in yet. If Ms. Zhou decides to drop a line, your humble scribe will let you know forthwith. Or fifthwith for that matter.

Want to be anonymous on the internet?

If so, take a look at this new post from professional journalist Frank Bajak, someone who knows all about the subject and is willing to share a whole bunch of tips with us all. A good post, plenty of practical advice here.

Bolivia's cocaine seizures improving since the US DEA was kicked out

And that's a plain fact. In the words of President Evo Morales yesterday, "We're better off without the DEA...On our own we're better than with them and we've shown this in a short period of time."

And there's plenty more data to underscore Evo's words than the chunk shown in this chart...


...but it's a good example. Once again the question of whether the USA is the problem or the solution regarding drugs is raised. And once again it will be totally ignored by the dumbasses up North.

Canaccord's source material on LatAm in two words

This blog.

It really is about time they employed somebody who can speak Spanish, instead of purloining ideas  from third parties and pretending them their own original DD. Braindead rugger fanatics currently reading these words in London, you have been warned. 

Chart of the day is...

...the "small silvers" year-to-date performance:


We used to track this basket of small silver companies quite regularly, nowadays it's just occasionally but today's the day the chart gets an airing. As you can see not one of them is showing a profit on the year, with Fortuna Silver (FVI.to) (FSM) easily the best of the bunch but still showing a 10% loss for the year to date. All the others, even the "quality" First Majestic, is underperforming the metal. Meanwhile, the pack has shown a loss of between 35% and 45% which is really quite pathetic, and that even takes into account the recent relief rally. 

Down at the bottom, no surprises. The stupid companies run by stupid people for stupid shareholders have been performing stupidly badly.

7/24/13

A Goldcorp (GG) sponsored junior miner kicking the crap out of local villagers in Peru: Plus Ça Change...

Rio Moche is a private junior mining company that was fed $2m by Goldcorp (GG) in exchange for 15.6% of company shares last January. The company's plan was to use the cash to explore and drill its Caupar project in the La Libertad region of Peru and that's what it's been trying to do recently.

Sadly, the locals don't want them there. And this shouldn't come as any surprise to Rio Moche, because before it changed its name, the company was called Trinity Mining and tried to do exactly the same thing back in 2011, only to get run off by the locals there who fear pollution and environmental destruction from any exploration project and eventual mine.

Anyway, trouble has been brewing for a couple of weeks (as subscribers to The IKN Weekly alreaydy know) but today it erupted, with the locals who went to the project site to lodge their complaints beaten up by police officers hired by Rio Moche and their own private security force, tear gas deployed, general violence and all types of the classic thug fun that goes with a brutal repression of locals by a mining company.

In other words Goldcorp is back in Peru, doing what it does best: Fucking it up for the whole of the mining community in the country. Assholes.


OT: "Dear Freelancers: Prepare to Kick Ass"

That's the title of this post by Eric Garland. It's all about the modern workplace and it's a simply excellent argument thinkpiece on the way in which employment has changed from just a few years ago to the way it is now.

(UPDATED) BREAKING: Guatemala Court of Appeals suspends operating licence for Tahoe Resources (THO.to) (TAHO) Escobal Mine

This news is being tweeted by Guatemala's Prensa Libre newspaper here, reporting on a press conference just given by the ant-mine group CALAS.

The group says that the Appeals Court decision is definitive and cancels Tahoe Resources (THO.to) permit to mine at Escobal in a adefintive manner. During the presser, CALAS asked the country's President to officially recognize the news and comment on it as soon as possible.

UPDATE: THO call the licence suspension reports "a complete lie" and are apparently preparing a NR to the effect.

UPDATE 2: Here's the section from the NR, just released:

Exploitation Permit Unaffected by Lower Court Ruling 

Late yesterday, a court of appeal in Guatemala stated that the Ministry of Energy and Mines (MEM) should have conducted a hearing of a written opposition to the Escobal exploitation license during the permitting period. The court did not rule on the substance or validity of the opposition, merely stating that MEM was obligated to hold an administrative hearing. The court did not invalidate or comment on the Escobal exploitation license in its decision. 

According to Tahoe President and CEO, Kevin McArthur, "The legality of the license is not in question and it remains fully effective. It is unfortunate that anti-mining forces in Guatemala are misrepresenting the court's limited ruling. Based on our conversations with MEM and legal review, we believe the opposition is without legal or factual merit." 

"Operations at the mine are in full force and not affected in any way." said Mr. McArthur. MEM and the Company are appealing the lower court's ruling to the Constitutional Court, which is expected to issue a decision in the next several months.

UPDATE 3: Post-bell and I've waited a while to make any comment for that reason. After checking out the facts behind the ruling it looks like THO does indeed have a problem here and the position the company took in the NR is a bit too blasé for its own good (can't say I'm surprised though, as in this type of thing it's a case of finding the sophistry rather than doubting it's there). THO is certainly right to say its operations at the mine are in full force" etc because what's happening now is construction, not production. However, it's clear that its production licence has been suspended (or cancelled if you prefer) by the court of appeal. The reaosn behind the suspension is that the ministry official who granted the licence ignored around 250 written objections to the mine project (made by locals) and just went ahead and signed off on the thing, which is against the rules. What has to happen now, according to the ruling, is that the Mining Ministry must emit a resolution in the next 72 hours to formally acknowledge the objections to the project re-start the production licence permitting process over again. What happens then is up for debate, but if the government tries to press the granting through without due deliberation on the objections so far ignored, we're likely to hit a Groundhog Day situation where the courts suspend the production licence again. Also interesting is that the anti-mine lobby are now calling for the new licencing procedure to come under the two year moratorium proposed by President Otto Pérez Molina only last week.

The bottom line: Right now today, THO can continue building its mine but is glossing over the plain fact that the ruling today stops the mine from entering into production.

More on International Tower Hill (ITH.to) (THM)

Oh dear, this could be a company in trouble with the market commissions people. We hear from reliable sources that the ramp-up of price in International Tower Hill (ITH.to) (THM) is due to company insiders, at officer level, tipping off certain people in the market that the Feas Study was about to be published and that the company was happy with its contents.

Here's how the 10 day chart (1 min intervals) looks:


We feature the US listed chart here because 1) it tends to do more volume than the Canada listing and 2) it's a reminder that this company comes under the direct jurisdiction of the US SEC, an entity with far sharper teeth than the pathetic Canadian overseeing bodies.

Lydian International (LYD.to) and a News Release interpretation pro-tip

Here's the NR linked.

And here's the pro-tip: You never want to see paragraph two of any junior mining news release begin with the word "however". 

The bid was at $1.42 when the news hit, let's see how things get on during the day. Full disclosure; no position in LYD.to, though it's been tempting to go long on occasion because people who I respect are long the stock. On the other hand Louis James also likes it, which counterbalances the opinions of mining professionals to a certain extent.

UPDATE: Half an hour later...



Oh dear. However...

By the way (I've been asked by mail this morning), the reason I decided against going long LYD, great rocks or not, is that i didn't understand the pol risk. Yup, got that one right.

UPDATE 2: Another hour goes by and, well, not going to upset you with the chart again, but....ouch.

However...

Chart of the day is...

...uranium and its continued woes:



You'll be amazed to hear that the chattersphere has been talking up uranium's future again, so you will. Gonna fly, any minute now, so they say.

7/23/13

A Flash update...

...has just been sent to subscribers on this Tuesday evening. A trade outlined.


Want to know how abysmal Larry Summers would be as Fed chair?

He'd be this bad:


The sooner you realize this whole "Larry now fave" whisper campaign was created by the pro-Yellen camp, the better.

Hugo Chávez on Anthony Weiner

There are some smart people that kindly rub some of their smartness off on your dumbass author and make him shine more than is deserved. For example, the LatAm historian Alex Goodall who notes that Hugo Chávez had Anthony Weiner* summed up correctly years ago:




*The difference between a Weiner and a Bush? A subject for psychiatric debate, methinks.



Good news for Gernot Wober: Braeval Mining (BVL.to) has decided to care (at long last)

NR here, which start like this:

TORONTO, ONTARIO--(Marketwired - July 23, 2013) - Braeval Mining Corporation (TSX:BVL) ("Braeval Mining" or the "Company") announces that it has given cancellation notice to the respective owners of the titles covering the Snow Mine property in Colombia. The Company is cancelling the option agreements due to unfavourable market conditions, and plans to refocus its efforts on its other projects.
This means that the ELN terrorists, who have been holding the VP Expl Gernot Wober hostage since January, have the condition they required from the company. Nothing's guaranteed of course (because the ELN are a bunch of fuckers) but chances of Mr Wober seeing freedom thanks to the better very very late than never decision of BVL.to have gone up bigtime.

International Tower Hill (ITH.to): Hey, you know how annoying those market assholes who whine "Ha ha ha, toldyaso" are?

Yeah well, here's the IRR table on the International Tower Hill (ITH.to) (THM)  Livergood Feasibility Study NR out a couple of minutes ago:


Toldyaso:  This dog isn't even worth getting out of bed for until gold's back to $2k/oz

Toldyaso: Negative IRR at $1,400/oz

Toldyaso: Total bullshit from start to finish from another Cardero smoke'n'mirrors scam.

Toldyaso. Toldyaso. Told. You. So.

UPDATE: Message for TFMetals report readers: You are brain dead assholes.

Sulliden Gold (SUE.to) community relations news

On August 7th, locals around the Sulliden (SUE.to) Shahuindo property in Cajamarca Peru will begin a protest and strike action against the project that's set for four five days (to 11th Aug) but may continue indefinitely, according to the organizers. In a nutshell, they want the company to leave. Details on request but hey, if you prefer that warm, soft feeling of Stan Bharti blowing smoke up your ass, feel free to ignore reality and follow Agnico Eagle in to SUE. After all, it's not as if you need to build a mine to make money in a junior, is it?

Is it?

Your Barrick (ABX) rumour of the day

Words and whispers from various quarters are that Barrick (ABX) is rolling out a big fat equity placement soon. Half a billion bought deal, anyone?

Peru's continued strong electricity demand points to an improving country GDP in June 2013

We've noted previously the strong correlation between electricity demand and GDP in Peru, so today we catch up with the charts as the June electricity numbers from the Ministry of Energy and Mining (MEM are just out. Here's the raw use chart (please note the cut-down Y-axis) and the trend is crystal clear; Peru's growth continues unabated:


So we then take those numbers, crunch them a bit and get the Year-over-Year percentage change in consumption, which goes like this:


Apart from the slump cuasded by the financial crisis, the standout here is how the percentage growth has trended slightly down since mid-2010. But, the last couple of months have hinted at a break higher, which would suggest Peru is doing just fine overall (and especially taking into account the commods prices slump of 2013). 

We then compare the electricity percentage growth line to the main headline GDP growth for the country (which, as you can see, correlates very elegantly) as supplied by the country's Central Bank:


Again, over to the right we have the new figure for electricity demand but the June GDP estimate isn't in yet. But there's decent reason to expect Peru to return another 6%+ figure when the announcement is made (usually at the end of the month or the beginning of the next).

Bottom line: Robust growth continues in Peru, as indicated by the energy consumption.

Chart of the day is...

...the gold/copper ratio again:


That's because it's an imporant chart to track at the moment. And it's coming back.

7/22/13

IKN urges you to read this article on Rio Alto Mining (RIO.to) (RIOM) at Sinking Alpha


So what can be said about it? Well, apart from the incorrect assumptions about mine life (oxide to run out in three years, you say?), costs currently being run by the company (not FCF+ at $1.3k/oz Au, you say?), costs of operation for the stage 2 sulphide ops (not profitable at $3.15/lb you say?) confusing the political risk of La Libertad with South side Puno (oh gosh, where shall we start with this one?....hmmm, how about "learn Spanish then read some books") it's really not bad at all. Which basically means he got the stage 2 capex ticket price right. Well done, sir.

Seriously, go read the note because counterparties are vital in this market. You may even agree with him so if you do, you may want to consider shorting RIO.to before the 2q13 financials are published. What with it being overvalued and unprofitable and all that. And oh yeah, just remembered, there is one more thing to say about that Sinking Alpha report which is that it cost you nothing to read it. Priced to perfection, I'd safely say.

Disclosure: Long RIO.to.


Breaking: Doug Casey says birth of royal baby "...is good news for gold"

This is a breaking story, updates soon.

UPDATE: More details now coming in on this bold prediction. Link here.

UPDATE 2: Jim Sinclair has now quickly moved to back up Casey's call. "There's little doubt in my mind that the new royal baby is a development will go a long way in breaking the back of the twisted and corrupt banksters holding gold down.", he says.

UPDATE 3: Casey's prescient call seems to have moved the market. We now have this Kitco headline "Gold Sharply Higher, Hits 4-wk High, on Royal Baby Birth and Short Covering" coming off the wires.

UPDATE 4: Prince William has just spent five minutes addressing the crowds of well-wishers who have gathered outside the London hospital where "the golden boy" was delivered. In a telling finale, at the end of the handshake session he raised his clenched fist and shouted "Long Live GATA!" before making his way back in.

Get down with the Pope

Franny's Brazil visit starts today, so dance it out.

Prince - Pope

Powered by mp3skull.com

You can be the President...

The sounds of gold rallying to U$1,322oz on a July morning

In junior mining newsletter boiler rooms:

"C'mon faster! Get that "I was right, bottom's in!" emergency update out to those idiots NOW!!!"

In retail shareholder's home:

Fapfapfapfapfapfapfapfap....

In Canadian brokerage's analyst cubicle (on phone):

"Yes, well...I've been telling them to....(fapfapfap)...and it's been tough, but I think...(fapfap)...we might be..."

In Canadian brokerage corner office (also on phone):

"A full warrant or nothing, got it?"

In junior mining company HQ (shouted thru wall):

"IR! Where the F*^* is that draft for the decent bit of news we've been holding out on? For *#@*'s sake get it out there!"


Pro tip: When firing an Uzi at cops, don't drop your wallet

Setty liked it (the title stolen from his tweet), your humble scribe likes it and now it's your turn to like this story out of Chile today. Original here, translation coming right up:

Iquique: Young Man Who Shot At Police With Machine Gun Arrested in Huayquique. 
21/7/2013 
The incident occurred in the early hours without causing any injuries, with the man detained by police and accused of attempted homicide of serving police officers. 
This afternoon a 21 year old man identified as Eduardo Varas was arrested for having shot at members of the police force in the Huayquique area with a mini Uzi machine gun in the early hours of this morning. 
The incident occurred when a police patrol was alerted by people in the area, where an individual and a group of his friends were firing shots into the air. 
On noticing the presence of officials, the young man repelled the uniformed officers by firing at them, after which one police officer used his regulation firearm to control the situation. 
After the confrontation, the young man escaped but while making off dropped his wallet containing all of his documents, which allowed him to be quickly identified. 
The man was arrested by the police and charged with the crime of attempted homicide against serving police officer, and also has a previous arrest warrant pending against him for drug trafficking. He is to be remanded into custody this Monday.


7/21/13

The IKN Weekly, out now



IKN220 has just been sent to subscribers. Words and numbers and pictures and tables and stuff. Mainly words.

Inside Cañaris

For the four people who read this blog and care:



Spanish language 10 minute video about the Cañaris region and its population.

A death in Peru football

Jair Clavijo, an 18 year old professional football player for one of Peru's biggest teams, Sporting Cristal Universitario, today died while playing during the reserves team match against Garcilaso, in the Cusco region of Peru. In initial reports are that Clavijo died of heart failure five minutes before the end of the match. The main match of the day between the two first teams has been called off, obviously.

Expect fall-out around this tragedy, with questions again be asked about sea-level based teams such as Sporting (a Lima team) having to go to the the altitude of Cusco (typically 9,500 feet above sea level) for matches. There have been long-standing arguments of international matches having to be played in La Paz Bolivia (~12,500 fasl), for example.

Peru Presidential approval ratings update: Splat

Today sees the latest monthly snapshot poll from Peru's benchmark pollster, Ipsos/Apoyo:


That 33% approval the lowest score of Ollanta's period and by quite some distance. Welcome to Peruvian mid-term politics, Mister President. Data here