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3/7/15

Nisman: Ghost in the machine

The dramatic and world-headline making press conference held by the ex-wife of killed (murdered?suicide?) public prosecutor Alberto Nisman is already beginning to look shaky. At that highly covered presser last Thursday his ex-wife and Argentine judge Sandra Arroyo Salgado stated that according to the readings of the autopsy report (made by her and her team) Nisman was not killed in-situ or on the Sunday morning/midday that the government insist as time and place of death, but was killed the previous evening and then moved to the bathroom where he was found.

Ms Arroyo Salgado's problem is that she doesn't have all the information to hand. According to records (and before you start with the "yeah but..." interjections, this isn't just the gov't's info, but also telephone company and internet company info), the computer in Nisman's apartment was turned on at 8am Sunday morning and then used to check all the things that Nisman typically checked, including his Yahoo mail account and various newspapers. 

Slight aside: IKN isn't going to start covering this story on a blow-by-blow basis, but today's is interesting because things such as facts are much less likely to be covered in the same media blanket as the "He was murdered!" presser we saw last week from Nisman's ex. That's because this case is highly political and as the CFK government has a whole stack of enemies both inside and outside of Argentina, you can guarantee that coverage isn't going to be free and fair. I still don't know whether Nisman committed suicide or was murdered and frankly, at this point nobody does*. I suspect he committed suicide, but one mouthy guy with a blog's opinion is of zero importance and I'd be perfectly okay about being proved wrong on my current suspicions. Plus there's the "cui bono" factor, which offers very little if any 'bono' to the government of Argentina for his death. After all, his two year in the making case filed against the CFK government has already been shown as shaky, to say the least. It doesn't take Sherlock Holmes to work out that it would have been to the government's benefit to have had the chance to cross-examine Nisman on the facts of his case and shown both him and the world at the same time that his prosecution was built on false facts and statements.


*Unless of course he was indeed murdered, which means by definition that at least one person knows.


Another Guerrero Mexico mining company kidnapping, this time Goldcorp (GG)

Here's the link, here's the translation:

March 6th 2015: On Thursday evening a group kidnapped four miners from the Carrizalillo mine, owned by the Goldcorp (GG) company, in the municipality of Eduardo Neri (Zumpango) in Guerrero State. 
Police information indicates that the men, armed and travelling in small trucks, including a Suburban and a Hilux, intercepted the men at a pass when they left the mine on the way home from work. 
The mine workers were identified as Juan Carlos Merino González, Mauricio Gatica Peña and Juan Carlos Peña, with the fourth unidentified.

3/6/15

The Friday OT: Faith No More; The real thing

The obsessive/compulsive IKN FNM jag continues. 


This song wasn't written by people who have smoked marijuana. It was written by people who understand marijuana, who got right to the bottom of it. And when you do you don't need to smoke it any longer because once the channels are open they stay open, no need to go back, no top-up required. In the words of the song, "And once you have bitten the core, you will always know the flavor".

But Angel Dust is still their best music.


"If you believe you can do something, then you can"

This, sent to IKN Nerve Centre by A. Person who has also given kind permission to use, is the funniest single thing I've seen for a long, long time. I'm no big fan of these silly Youtubes but this one is different, make time and watch this, you'll never regret it.



The treasure moments begin when you see "bored" appear. They then get better and better and better.

For what it's worth, there's something about this that reminds me of subscribing to Casey Research.

Just in case, original link here.

A Flash update...

...has just been sent to subscribers, a few minutes after the opening bell on this Friday morning. You sellin' today? Good, cos I'm buyin'.


Jerbs

The chart that matters:


And as usual, forget the dross and go to the best independent reader of US macro in the business. Bill McBride and Calculated Risk's take on the US Jerbs nermbers, right here.

Explaining the Luna Gold (LGC.to) forbearance agreement news from yesterday

Good morning ladies and gentlemen readers and visitors of IKN, we hope this Friday is treating you well and this post finds you in good spirits. After receiving a couple of mails already on last night's news release from Luna Gold (LGC.to) with general inquiries to its consequences, IKN has decided to run a short explainer on the subject. 

Imagine, if you would, a conversation between Luna Gold management and the group of financiers that lent them money:
Lenders of the $30m revolving credit facility: "According to the terms of the contract we signed in early 2013, you are now in non-compliance. Do you agree?
Management of Luna Gold: "Yes, we agree."
Lenders: "We therefore have the right to fuck you up the ass at this point, if we so desire. Agreed?"
Luna: "Yes, that's true."
Lenders: "Therefore we come to the central question: Would you like to be fucked up the ass today?"
Luna: "No, we would not like to be fucked up the ass today."
Lenders: "Are you sure?"
Luna: "Yes, quite sure."
Lenders: "Indeed, we thought as much. In that case, pay us $100,000 and we won't fuck you up the ass today."
Luna: "OK, we'll do that."
Lenders: "And the cash you have in escrow for the contract hedging program, give us that now."
Luna: "That's $6m dollars!"
Lenders: "It is. But we're not asking for that for free like the $100,000 legalized extortion you've already agreed upon, you can count that against the money you owe us."
Luna: "Oh, OK. In that case yes we agree."
Lenders: "However, this won't stop us from fucking you up the ass at any point in the future if we feel like it, our agreement today is to stop us fucking you up the ass right now. We hope that's clear."
Luna: "Yes, that's clear."
Lenders: "Right, all settled then. Have a nice day."
Luna: "Thank you, have a nice day you too."

We hope this sheds light on the issue. Please have a nice day.

Lead (Pb): After great pain, a formal feeling comes




When Emily Dickinson wrote the words This is the Hour of Lead, she probably wasn't thinking about the metals market in 2015.

3/5/15

Alberto Nisman: Down the rabbit hole we go

This will run and run. Today the ex-wife of killed (murdered?/suicide?) public prosecutor Alberto Nisman, herself a judge in Argentina, held a press conference in which she stated that after examining the forensic evidence available she was certain that her ex-husband was murdered. She cited evidence from the gun shot that killed him (including the lack of residue found on Nisman's hand, the trajectory of the bullet) as well as stating that the body had been moved after death and that the government's conclusion about the time of death were wrong. Uki Goñi, about the best English language reporter covering the country, has filed this report on today's happenings, which gives the facts as seen in the presser but does little to capture the commotion in Argentina today after the event.

IKN repeats: It's an election year in Argentina.

LME copper warehouse inventories broke the 300,000 metric tonnes barrier yesterday...

...and then it really broke it today:


That's 318,375mt over there on the right, it's up from 177k at the beginning of this year and notably, the big recent move is in its European warehouses as well as the Asian ones. Data from the excellent Chilean metals site Cochilco 

Must-read research on community and political risk in Peru

Now, this humble corner of cyberspace has occasionally been known to lapse into snark and irony in order to make a point or two, but there are also times when we get to pass along solid and fundamentally important research into LatAm mining issues, the type that professionals in the sector need to read. This post is one of those moments.

The paper linked here is entitled "Getting it Right? Challenges to Prior Consultation in Peru", and is written by two internationally respected social science academics. It goes into well-researched detail on the "Consulta Previa" (prior consultation) law in Peru that is supposed to give local populations a voice and legally binding opinion on large civil works projects that may affect them. This, of course, includes mining projects in Peru. What you don't get is a mouthy op-ed piece, what you do get is a thorough 33 page paper that goes into specific examples of how the law is (and is not) being applied in Peru, the problems arising, plus potential improvements in the current situation.

This cannot be stressed enough: It's a must-read for anyone connected with or concerned about the mining industry in Peru. You read this paper, you'll know what there is to know. Here's the link again, it's a free download, go use it.

And Endeavour Silver's (EXK) (EDR.to) 4q14 numbers underscore just how bad Great Panther Silver (GPR.to) (GPL) is

Because you look at the EDR.to numbers, guffaw at yet another loss, wince at the pain the shareholders of this stock must be feeling, laugh at how inept Brad Cooke is as a CEO....and then you think "Well, at least it wasn't as bad at GPR's quarter".

Yup, That's how bad Great Panther Silver is.

Great Panther Silver (GPR.to) (GPL): It's not just the operating results that suck these days

The balance sheet is also clearly degrading now.

It's actually depressing to cover Great Panther Silver (GPL) (GPR.to). It used to be perversely funny, but we're now at the point where the company hasn't returned a quarterly net profit since 1q13 and your author's total mystery as to how this abysmally run silver mining company can command the share price that it does (even after the big drop it's seen) has transformed into resigned headshaking and wonderment that there are retail investment people out there stupid enough to own this stock still. Anyway, GPR reported another set of trainwreck financials last night (amazingly they waited until PDAC was over) and here are a few charts of the balance sheet items only, because even the dumbass ne'er say die brigade will be able to work out that a $26.9m net loss isn't good.

Assets have taken their write-down (all the following in Canadian dollars):


Debt is rising:

And though working cap seems to be holding up...

...a lot of that is a mysterious line item "trade payables" that looks overstuffed, never seems to drop much from quarter to quarter and the footnote details on this line item are very vague. Got a bad debt there that you're not disclosing, Mister Archer? 


The cash treasury of which GPR is so proud is now under CAD$18m, or if you prefer that's less than 13c per share. We can guarantee that cash position will drop further in 2015 at any silver price under U$18/oz (and even then that's probably being generous). Meanwhile, book value is CAD$0.42 per share, which means its current CAD$0.74 share price is still in the clouds compared to what it can do under current silver prices. No wonder this company is keen on buying assets using all-share deals (and even then ripping off the target company's shareholders).

Finally, and to highlight just how much of a zero-sum game this company is, consider that its book value (i.e. all the assets minus all the liabilities) is $58.73m and its deficit since inception is $75m. Quite literally nothing has come from this company since it was started, apart of course from the way it's made a small handful of directors rich. 


3/4/15

PDAC attendance, down again

Here's the chart:



Here's the NR, here's how it kicks off:
TORONTO, ON--(Marketwired - March 04, 2015) - The Prospectors & Developers Association of Canada (PDAC) welcomed 23,578 attendees from over 100 countries to its annual convention. The crowd included investors, analysts, mining executives, geologists, government officials and students who made the annual pilgrimage to the Metro Toronto Convention Centre (MTCC) for the largest exploration and mining event in the world. 
"We consider this a very successful year, attendee feedback has been extremely positive and the number of attendees is similar to last year," says PDAC President Rod Thomas.
To be accurate, PDAC 2014 had 25,122 attendees so this year's is down by 6.1%. Obviously the word "similar" means something different in the Canadian dictionary.

UPDATE: Yes, I've noticed as well. It'd be difficult not to, in fact:


Not a perfect fit, but waaaaay more than close enough. Spooky, huh?

Wednesday wondermusic: Faith No More; Best

Three hours of music from FNM and not one single weak track. Amazing.


Stick it on, go about your day, I guarantee they'll be at least a dozen moments of "Oh yeah this one!" and catching youself singing along. Impossible to pick out a highlight, but I will say that when Stripsearch ran into From Out Of Nowhere (around the two hour mark) the hair on the back of my neck stood on end. Full playlist for your consideration and eventual enjoyment:

Ricochet, Underwater Love, We Care A Lot, Kindergarten, The Cowboy Song, Absolute Zero, Digging The Grave, Helpless, Zombie Eaters, Be Aggresive, Faster Disco, Caffeine, Evidence, Last Cup Of Sorrow, Falling To Pieces, Everything's Ruined, King For A Day, The Real Thing, The Perfect Crime, Land Of Sunshine, Just A Man, Pristina, Introduce Yourself, The Morning After, The Gentle Art Of Making Enemies, Easy, What A Day, Stripsearch, From Out Of Nowhere, RV, Chinese Arithmetic, Get Out, Midlife Crisis, Surprise! You're Dead!, As The Worm Turns, Collision, I Started A Joke, A Small Victory, Caralho Voador, Edge Of The World, Ashes To Ashes, Epic


PS: Aiee caramba! The earworm I've picked up today for the chorus of Underwater Love is so bad it's almost a medical condition. Damnation, that slap bass is good.

Barrick (ABX), Newmont (NEM) and vampire squids

This is a chart of Barrick (ABX), Newmont (NEM) and the gold bullion ETF (GLD) over the last ten days, which starts at Thursday Feb 19th when both stocks popped on their Q4 results. The squiggly lines run to today and clearly, Newmont's doing better:


Here's a piece from IKN 302 dated Sunday Feb 22nd, the weekend following the Q4 numbers from both companies.

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There were many 4q14 results filed by the big mining companies last week, including NEM, GG, most other large name you’d care to mention along with several of the wannabe large names you can mention. NEM’s numbers were good and the stock rightly rallied, but when Barrick (ABX) reported its 4q14 and year-end numbers on Wednesday evening (9) it caught much of the limelight, to the point where little old IKN bothered to make mention of the NR (10). There was a lot of talk in the NR and subsequently in the mining chattersphere about the NR, with all its promises and that Back To The Future motif. You’ll also note that ABX rallied on the news and, like NEM, bucked the sector trend to finish positive on the week. On discussing the results with a couple of trusted mailpals in this crazy business I wrote the mail below at one point and one of my pals told me it deserved a bigger audience, that I should stick it in the Weekly. So for what it’s worth, here it is (grammar slightly scrubbed, but it’s the same):

My read from the ABX NR (and reaction) is the Goldman Sachs angle. The narrative is that Thornton is adopting a strategy more akin to "real business", i.e. more transparent, clear goals and deeply concerned with the things anal ysts like, your balance and your debt and your positive free cash flow and the love and deep respect for the shareholder.

Yes, of course it's BS. But it's the type of BS perfected in and by the Vampire Squid. The delivery of the message is also key because the company that wants to project this cannot say it out loud, but instead plays to the egos of its audience by stating its case and leaving them to "discover" the subtext, which is then relayed to the paying audience (i.e. we insto/retail chumps who buy shares) as their considered analysis of the situation. Hence we get "ABX turning a corner". We get "the giant is awakening". We get "time to be on". Pure style over substance, pure neoliberal playbook. What could possibly go wrong?

Suffice to say that I was less impressed by Barrick than with Newmont last week. To ABX I say “Where’s the beef?”.


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ABX CEO Thornton, who came to the company after a stint as president of a finance company called Goldman Sachs,  is a product of his background. Squid is what squid does.

Adjusting Barry Ritholtz for inflation and hypocrisy

Today in "Please Stop Talking About Inflation Adjusted Nasdaq", Barry Ritholtz begins his purple prose with:
"The last refuge of scoundrels is their blind insistence that all data points must be adjusted for inflation."

In October 2009 in "Gold (inflation adjusted)", Barry Ritholtz told us:
"While everyone seems to be all abuzz over Gold’s new highs, you should be aware that these are nominal, not real highs. 
"Adjusted for Inflation, Gold is nowhere near its all time peak — in real terms, its only about half its prior highs"
This one's for you, Baz:


UPDATE: Ritholtz replies:



There's a lesson for the mouthbreather goldbugs here: When you're wrong, admit it. That's (one of the reasons) why Barry Ritholtz is rich and successful and you're not.

Jemi Fibre (JFI.v) runs a bought deal

There is so much to love about this news that I don't even know where to start. So let's start with the term sheet:

And here's a price chart:


And while you read the terms of the deal, make special note of the way GMP et al have insisted that JFI insiders have to keep hold of their shares for a year instead of doing the classic Bobby G trick. Plus Mike Jenks has to exercise all his 32c warrants at the same time.

But in the end I can't hide the fact that I admire Bobby Genovese for being able to do this sort of thing. Even after having a track record of ripping off the market like few others and scumbag morals of the complete sociopath, he's able to convince banks and brokerages to raise capital for his next scheme. That shows an understanding of how corrupt and greedy the suited people are that's far deeper and more insightful than mine will ever be. IKN salutes you, Bobby G. 



Chart of the day is...

...Copper, last week and a half that includes the pop to over $2.70/lb on the return from the China New Year holiday, plus the disappointing follow-through since then:


Here's part of what was written on copper in IKN303, out last Sunday; holding up quite well so far this week:

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There was a lot of “BUY COPPER NOW!” screaming and shouting from the brokerages last week on the back of the Chinese-induced price pop, but frankly I’m still leery, was leery when I saw the move over U$2.70 and stayed leery during the Friday pullback. The reasoning is simple enough:

1)      According to what we know to a decent level of confidence now, the waterfall drop in copper prices early January was run by a group of high-powered (and very well funded) Chinese financial entities.
2)      I highly doubt they would have run a successful short attack in the way they did without the approval (overt or tacit, I don’t care) of the Chinese government and State.
3)      Which means they’re not going to go away at the first apparent reversal, plus...
4)      ...if I were a Chinese shorter of copper playing a longer and altogether more lucrative game, allowing copper to pop the way it did on the day back after Chinese New Year is exactly what I’d let the price do.


So I’m not jumping to conclusions on the back of one single price move and I’m not moving away from a wholly neutral stance on copper yet. It is, however, time to watch the copper price moves very carefully.


Mickeyman does PDAC, part deux

Following on from Mickeyman's first post on his jolly japes and jaunts and haunts around PDAC 2015, here's the link ot the second part in the series. The usual activities noted; mining people, alcohol and dancing.

3/3/15

Brent Cook does BNN's Market Call on Wednesday March 4th

You can mail in or phone in or Twitter in or whatever in your questions, too. So it'd be great if you ask him about Continental Gold (CNL.to), Gran Colombia Gold (GCM.to), Barkerville Gold (BGM.v), International Tower Hill (ITH.to), Corvus Gold (KOR.v), Exeter Resources (XRC.to) or Pretium Resources (PVG.to) , but he'll probably end up talking about Mirasol and Almaden as usual.

No worries, whatever he comes up with is worth watching. Cook's a rare thing in the mining sector; he's honest. Which still confuses the hell out of most people when they hear him talking.

UPDATE: you can watch the video, starts here.

Troll Hunters

This looks particularly promising. Excerpt here:

Public humiliation is never more entertaining than when it’s justified. That probably explains the success of Swedish TV showTrolljägarna, or Troll Hunters. It follows journalist Robert Aschberg as he tracks down so-called “trolls” who have posted hate speech in social forums or abused individuals online and then confronts them on-camera. 
The entertainment value is evident from the show’s first episode (and in its spread to neighboring Norway, Denmark, and Holland with a similar production being considered in the UK, according to Henrik Stenlund, former CEO of production company Strix Television). When Alexander, 20, walks across a parking lot in Sweden to greet Aschberg and his TV crew, the young man thinks they’re about to discuss a potential new show. 
But Aschberg is there to confront Alexander with a self-posted Facebook video in which he aggressively rants against a young woman who has openly talked about being raped. In the video, which provoked a storm of abusive comments directed at the young woman, he calls her a liar, along with various other words that would have likely been bleeped on American TV. All of it is documented in the printed transcript that Aschberg pulls out and starts reading. 
Alexander, appearing baffled and confused, looks from the transcript to the camera, denying that those words were his. But Aschberg keeps pressing, and Alexander’s reactions start shifting between denial and justification. “Well, calling an innocent person a whore is over the line… But if she is a whore, then I guess it’s okay,” says Alexander, whose Facebook page, Hult Hatar, or Hult hates, is dedicated to videos in which he spews vitriol against anyone with whom he disagrees. The page had about 30,000 likes when the show was recorded. 
By the end of the encounter, Aschberg hands the man a note stating that he is legally bound to pay approximately $1,200 in damages to the woman within three weeks.

Oh good, it's Fraud Prevention Month in Canada

Which may mean the other eleven are Fraud Encouragement Months. 

Cynical? Moi?

Anyway, quips aside this deserves a few more eyeballs so here's the BCSC on Fraud Prevention Month link and here's a paste-out of the presser:

Be an informed investor: Check before you invest

2015/17
March 2, 2015
Calgary – March is Fraud Prevention Month and the Canadian Securities Administrators (CSA) are encouraging Canadian investors to take the time to research investments before making important investing decisions. Before investing, the CSA recommends that investors follow these four easy steps:
  1. Check registration of the person or company selling or advising about securities. The CSA National Registration Search is a simple and free tool for investors to use to check registration.
  2. Check disciplinary history to find out if the person or company has broken regulatory rules in the past. It’s easy to do through the CSA cease trade orders database and the disciplined persons list.
  3. Check available tools and resources that the CSA has to offer to assist investors in learning how to protect themselves and their investments.
  4. Check the news and search online to see if there are any news releases or online information about the company or person.
“CSA investor education tools and resources can help Canadians become informed investors, which is one of the best defences against fraud,” said Bill Rice, Chair of the CSA and CEO of the Alberta Securities Commission. “The CSA is here to help investors protect their money and learn how to avoid investment fraud. It starts with a simple step: checking registration.”

The CSA would also like to remind investors to participate in Check Registration Day on Wednesday March 18 2015. Checking registration is easy and a great first step to becoming an informed investor. Investors who access the National Registration Search for the first time will be asked to complete a brief survey to help us make future improvements to this tool.

During Fraud Prevention Month, investors can follow tweets from @CSA_News for additional helpful tips and information on being a smart investor and fraud prevention.

The CSA, the council of securities regulators of Canada’s provinces and territories,
co-ordinates and harmonizes regulation for the Canadian capital markets. 


Mickeyman does PDAC, part one

Mickeyman over at The World Complex is somebody actually worth listening to (which separates him from the author of IKN, for just one example of the detritus that clutters up the mining chatt-o-world). Here's his first post on PDAC 2015, with photos and words and stuff.

I'll link up any future posts of his on PDAC 2015 as and when.

Columbus Exploration (CLX.v): A guy called Giustra scams retail investors

La plus ça change...

This NR from yesterday evening made me laugh out loud. In it we hear that Columbus Gold (CGT.v) is getting the Mogollon silver property from Columbus Exploration (CLX.v) in lieu of a near $450k debt owed. Follow the bouncing ball, people:

  • Back in 2007 CGT.v loaned some cash to CLX.v. The principle on the loan was paid back, but the interest wasn't. That was about $300k at the time.
  • Meanwhile, CGT does general accounting and book-keeping work for CLX.v and charges the smaller company $10k/month for the privilege. Nice work if you can get it.
  • All this time, the Mogollon property is valued at a tad over $2m. At this time it was under an option deal to a company called Santa Fe Silver.
  • Then in 2014 the deal with Santa Fe was changed and under the new deal, Santa Fe could buy Mogollon outright for a total of $1m cash ($50k down, then $950k cash by November 2014)
  • Over at CLX.v, the people...errrr....doing the books in the company (see above) decide to write down Mogollon to $450k value in the September 2014 financials, giving their specific reason as the new deal with Santa Fe.
  • (Did you get that? Agree to sell something for $1m and because of that state in your filings that it's only worth $450,000? No, I have no idea either, must be the wonders of science or something).
  • Then the Santa Fe option/purchase deal lapsed definitively.
  • And now CLX.v swaps the property that was valued at over $2m less than a year ago for a sub-$450k debt that was accrued on loan interest and services provided by the very company that's the new owner of the property.

And you may be shocked, shocked ah say!, to find out that the people running CGT.v are the same people who run CLX.v. Headed by a guy called Giustra. Now, where have I heard that name before? Darnit....where...tip of my tongue...just can't seem to....

Another round of retail shareholder back passage love process and subsequent bleeding complete. Enjoy your Tuesday.

In which the Wall Street Journal asks Otto Rock for advice on the Apple iWatch

You people out there are mad. A little story of how things snowball coming up.

So last week Ralph Rushton of Focus Ventures (FCV.v) mails me to show me a link to a very, very stupid story about how Apple will apparently need one third of the world's mined gold per year for its new gold iWatch. It was total BS and by way of reply (which took about five minutes of searching for the numbers, part of which you see below) I did a bit of calculation to get to just over 9 tonnes instead of the incredibly stupid 746 tonnes estimate being made by morons who like hits on their articles more than facts.

As it happens Ralph sent our mail exchange thoughts to a friend of his who works at a shop called Ambrian in London UK. Fair enough. And Ambrian used the exchange and mentioned my name in the piece sent to clients as part of their own debunking. Also not a problem.

Here's the point---> This morning i have the freakin' Wall Street Journal on my ass, wanting to know all about the iWatch! Here below is the mail from the WSJ reporter:

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Hi – I’m a reporter with The Wall Street Journal in London and we’re taking a look at the furore over Apple’s gold watch, and how much gold it will actually use. Apparently you’ve had some interesting comments on this topic, and I was wondering if you might be able to send me your thoughts.

Specifically the questions we’re addressing:

-          Will Apple need 746 tons of gold per year?
-          Will Apple be able to sell 1 million gold watches a month?
-          Do you envisage any impact on the gold market from the Apple watch?

Any help would be much appreciated!

The world's obsession with AAPL writ large...seriously, don't these people have anything better to do? Anyway, here's what I sent as a reply:

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If by "interesting" you mean to sadsack Apple worshippers with nothing better to do than obsess over the gold mkt for the first time in their acne-strewn lives because Tim Cook has decided that shiny is the new future then yes, it's interesting.

-          Will Apple need 746 tons of gold per year?

No. See below.

-          Will Apple be able to sell 1 million gold watches a month?

My opinion is no, nowhere near. The price point differential between a "normal" steel case ring and a gold one is going to be enormous, while the difference in functionality is zero. This isn't the market. We already see how gold iPhones/gold plated Samsungs etc etc designed for the rich in mind are ignored. The thing with phone tech /handheld tech etc is that once you have the top thing (let's say for argument's sake the best iPhone) very very few people are interested in an enhanced status symbol, even the megarich (who have their Ferrari parked outside, something that will make a better statement any day).
The act of status here will not be to wear gold Apple, it will be to wear Apple. There's no need to waste money on the superficial appearance.
My best guess on gold iWatch...and i mean most optimistic guess, is 50,000 units a month if AAPL does meet its market guesses and shifts 5m/month in total. It may well be less for the gold version, but I stress that I have no idea for overall sales figures apart from "Apple will sell oodles".

-          Do you envisage any impact on the gold market from the Apple watch?

No, none The Rolex President Gold has:
  • Case ring 18.5 grams. Contains 13.875 grams of pure gold. 
  • Case back 7.21 grams. Contains 5.41 grams of pure gold. 
  • Bezel  5.3 grams. Contains 3.98 grams of pure gold
  • The bracelet 68.85 grams. Contains 51.64 grams of pure gold.
  • Total weight: 99.86 grams. Contains 74.905 grams of pure gold

That's a touch over* 2 1/2 ounces of gold. Have you seen one recently? You can see somebody wearing one of these things from two blocks away. If the Apple Gold gets to 15 g 24KT Au I'll be surprised. It's only going to be the case ring, perhaps the bezel. So, let's call it half an ounce and be generous. (note: one Troy ounce of gold has 31.1 grams).

Then "reports" have Apple estimating 20% of sales to be for the gold watch. On 5m units per month. Are these people out of their freakin brains? A million a month? If they shift 50k gold watches a month i'll be impressed (see above) but again to be generous, let's go for my 50k/month guess.

So, 293,000 ounces of gold a year. Or just over 9.1 metric tonnes. That's one medium sized gold mine's output in a year. Zero issues.

Best, O

*I now see my mistake, as that's a touch under, not over. Bite me

UPDATE: Iwnattos over at Market Narrative adds his tuppence worth on the subject because...well, because he's quite good at doing that. Read that slice of fruity prose right here.

3/2/15

Iwnattos does Rick Rule does BNN Market Call

Via a headsup from Iwnattos over at Market Narrative, your humble scribe notes that Rick Rule did BNN Market Call from PDAC this afternoon and you can watch the video too.

And hey wow, check out around minute 01:30 behind Rule's shoulder on the down escalator. That sure looks like Brent Legend Cook to me.

UPDATE: Not a bad Q&A in fact. Rule makes a particularly good point about how AISC and write-downs combine these days. Plus we get to see how well (ahem) his PDAC 2014 picks did over the year. You liked it at 3? Well you'll love it at 1.5!

Lies, damn lies and ____________", Chile/Peru mining edition (from IKN303)

Here's one and a bit pages from this week's edition of The IKN Weekly:




PS: Ugh, just noticed I used "i.e." when it should have been "e.g." Hate that mistake.

And so farewell, La Nación

I've been a reader of Argentina's national daily 'La Nación' for something like 16 years 17 years (come to think of it) and even though it's moved from a neutral stance to the current Kirchnerist government to a very hostile and anti-Kirchnerist editorial line in the last few years, it's always been more palatable and readable than the arch-haters of CFK over at Clarín. But today it's goodbye forever, La Nación, because you've just adopted the world's most stupid rules for viewing your reports and articles.

1) In a perfect world, a media channel on the web remains free of charge (e.g. The Guardian).
2) In a perfectly acceptable world you sign up your e-mail address and that lets you read the things, while your chosen media occasionally sends you a blurb in the mail (e.g FT Alphaville).
3) In an OK-I-Suppose world,the media channel runs a soft paywall, you get to read a limited number of pages per week or month, if you're a big enough fan of the site you can then pay up for full access (e.g. The New York Times), or you can search for the workarounds (not too hard).

But what you do not do is what the numbskulls at La Nación now require of you. Because since late last week, if you go to the front page and if you click on a report the site prompts you to either sign in with Facebook or with Google. But it wants you to give your Facebook or Google password while signing up, too. Seriously. Are these people mad? 

Therefore, as of today IKN has decided to offer two choices in the Argentina media links. You now have Clarín as an anti-government/CFK option, or you have Pagina 12 as the pro-govt/CFK choice. Neither is a great read (Clarín has gone more sensationalist over the years and its utter hatred of the CFK govt drips off the page, while Pagina 12 can be a dust-dry read and is rarely critical of a government that's neither angel nor devil), but put the two together and you get a balanced window.


And they're both free access. And neither is plug dumb stupid enough to ask for your sensitive online passwords. La Nación committed 21st century media suicide last week, the question is how long it'll take before they realize this.

Your PDAC 2015 program, highlight from day one

This page:


When compared against this chart.



Hey Torex! Good traded volume today! Winning!

Good old Eldorado Gold (EGO) (ELD.to), making your PDAC Monday morning that much funnier

Eldorado Gold (EGO) (ELD.to) started its NR today with this...
VANCOUVER , March 2, 2015 /CNW/ - Eldorado Gold ("Eldorado" or the "Company") hereby informs that on Friday February 27, 2015 , its Greek subsidiary, Hellas Gold S.A ., received a formal notice from Greece's Ministry of Productive Reconstruction, Energy and Environment (the "Ministry" or "Ministry of Energy") revoking the approval required to complete final construction of the processing plant at the Skouries Project.
...which means of course that the company is deep in the doo-doo as regards Greece (but frankly, those of us paying attention knew that already). However ELD saved the best til last with this unintentional hilarity at the end
"...the recent decision of the Ministry of Energy - if not reversed in a timely manner - may force Eldorado to reconsider its investment plans for Greece."
Translation: "Now look here you small brown chappies! If you don't allow us to mine in your country we may consider stopping our mining activities. So there."

Moral: Never underestimate the quantity of utter dumbasses running any given mining company.

Orignale Resources (MOOS.v) has great news today


VANCOUVER, BRITISH COLUMBIA--(Marketwired - March 2, 2015) - Orignale Resources (TSX VENTURE:MOOS.v) ("Orignale" or the "Company") is pleased to announce it has amazingly managed to time one single semi-crappy drill hole assay from the 12,000m worth of complete dusters it drilled in late 2014 to coincide with the Monday morning of PDAC in Toronto. 
Initial assay results from the ongoing BS-North drilling program located on the Company's 100%-owned Moose Pasture Project in somewhere very cold indeed have returned 1.0g/t gold over 100m, including an intersect of 100g/t gold over 0.9m at 900m depth. The Company is conducting a blah blah blah just buy the stock will you, we need to run a placement.


3/1/15

The IKN Weekly, out now


Chile's gift to modern society

IKN303 has just been sent to subscribers. Thirty-four pages, over 16,000 words, most of them spelled correctly. Not covered in chocolate-flavoured coating. Yum.

And now, the great PDAC comic strip debate

This afternoon your humble scribe received this Calvin & Hobbes strip in the mail, along with a pleasant word or three from reader 'CM'. Well worth adding to the mix:

"...as I am an interested reader (aka freeloader) of your blog I've seen there is a discussion about the right tune for the PDAC, I thought maybe there is a PDAC comic strip needed as well.
 
"For me the one attached is the perfect description of the junior resource market when having conversations with company promoters, which I finally understood after having paid a nice new car into this market as apprentice's premium."

Well played, CM. Well played indeed.

Ireland's try against England

For your viewing pleasure, here's two minutes' worth of excellent rugby action from today with the finest ending possible: Ireland sticking it to England where the sun doesn't shine:



Ireland won 19-9 and this is the moment that broke England. Great teamwork, with top skills to finish it off.

PS: Gotta love the review process, with the whole crowd deathly silent as they watch. Then they see what Robbie Henshaw did (beat England defence, catch, control, ground ball cleanly) and as one, the enormous roar.