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4/11/15

A photo of people waving at photographers

It's the 7th Americas Summit, it's in Panama, it has a lot of Presidents and other people:

click to embiggen

Canada didn't send its Head of State, she was busy at Andy Murray's wedding or something.
'Chelle didn't go, some other Chilean took her place.
Nico Maduro's ordering a coffee or a beer, it seems.
Varela looks like he needs a pee. And a better fitting suit.
You get three Enrique Peña Nietos for one Nicolas Maduro.
Evo Morales has put on weight.
Juanma Santos decided to rawk the TAN SUIT in public, bless his heart.
Rafa Correa's looking older
Barack Obama got old! When did that happen?
Dan Ortega got really old! Seriously, looks older than the dude from Cuba.
Life's too short, and so is Ollanta Humala.


Lefsetz on Tidal (and other things)

The public has options. Whether it be YouTube or piracy. Trying to convince people that stealing is immoral doesn’t work, the RIAA already tried that. Don’t demonize your customers, EMBRACE THEM! 
... 
We live in a nation of vast income inequality. We don’t want to hear winners complain. Ever. And we don’t want to hear how a product benefits you, but how it benefits US!

Whole thing here, well worth reading to understand why Jay Z's getting this all wrong.




Tommy Humphreys and Peter Epstein, made for each other

Here's what Tommy's pal Peter Epstein sagely predicted in the O&G space in the eighth month of 2014.
Peter Epstein: Oil and gas is unique in that it hasn't budged when so many commodities have fallen precipitously in price. Coking coal prices, for example, are at multiyear lows. The iron ore price has fallen below $100/metric ton. The uranium spot price has fallen to a nine-year low. But oil prices have held in the $90–100/barrel ($90–100/bbl) range on West Texas Intermediate crude for three or four years, steady and strong. Natural gas prices collapsed in 2012 but have come back fairly strong, only recently giving back a bit of the gains. That's why I like oil and gas. It's a strong commodity. Even with all this talk about a slowdown in China, which causes lots of commodities to fall, oil and gas sticks in there.
Impeccable timing. 



And this is the thing with these pals' clubs of sellside airheads and promotional BS merchants who take backhanders from companies to get their name to your eyes: All the fun, all the talk, no responsibility whatsoever. Whole Epstein oil thing here. 

The most visited IKN post this week is...

...this one, "Sandstorm (SAND) (SSL.to) is still throwing good money after bad" and by quite a distance too (it clocked around 400 more than the second placed effort).

BTW, most people who come over to this humble corner of cyberspace don't read specific posts, but come for the main page, read what's there by scrolling down then are done. Individual post hits tend to happen when somebody or other links to a specific story, e.g. via mail or Twitter or Feibu or a chatboard. Or they read all posts in the e-mail daily digest the next morning. Just saying.

4/10/15

The Friday OT: Mahler's 2nd Symphony, Simón Bolivar Symphony Orchestra, Dudamel

A few months ago we ran Mahler's 5th as a Friday OT piece and I mentioned in passing in the post that my knowledge of Mahler wasn't particularly deep. Cut to three weeks ago; a mail arrived from reader KW who'd just caught that Mahler Five on these humble pages, professed her love of Mahler and along the way (with a few other links and suggestions) asked me whether I'd ever seen this...


...the Mahler 2 done at the 2011 Proms by Gustavo Dudamel and the Venezuela Symphony Orchestra. 

I hadn't, but now I have several times. Sublime music, a climatic ending, the crowd go wild at the end as they darned well should after something this bogglingly good. And check out the players, who knew how well they'd nailed it, choking back the tears as they lap up the applause and cheers. It's rapidly becoming my favourite piece of music and if this doesn't get you to fall for Mahler nothing will.

UPDATE Saturday afternoon. Reader 'IS' has just mailed in and made my day:
"Just wanted to say that I've been reading your blog for some years now.  I don't really give a crap about mining.  I mostly read it for the little tidbits of Latin American News as that's what I teach but I gotta say... you put some pretty sweet music up man!  That Mahler piece was fantastic!"


Rob McEwen laughs it off

My thanks to A. Reader (you da man) for the headsup

Check out yesterday's bizarre BNN interview between Andrew Bell and Rob McEwen concerning the armed robbery at the McEwen Mining (MUX) (MUX.to) El Gallo mine earlier this week. But the short version is:

"...Oh ha ha ha yeah...armed narco gang...kidnapped the workers yeah...hehehee!...nasty men dangerous guns...yeah...heheheheeee...traumatic....hahaha...shotguns in your face....titter guffaw...inside job....chortle yok yok....narco gangs....guffaw snicker...yeah we usually have a good relationship with the narcos too! Hahahaha! Oh Andrew thanks for having me on the show..."

Meet the Guy Building the Bloomberg of Junior Mining

This you have to read. High comedy, I've read it twice already.

UPDATE: Link repaired, now works.

Annals of Clive (BTO.to) (BTG), options ka-ching edition

How to get a lot richer, the special B2Gold (BTO.to) (BTG) board of directors way.


1) Get your restricted shares:



2) Get your restricteds turned into fully paid up shares:



3) Get your options:



4) Cash out 300,000 of the papers at between $1.90 and $1.95:


They only want him for the money, y'know.

All these bonus shares and options and incentive payments because BTO has done so fantastically well at market in the last 12 months and it's only fitting that the top execu...


...ah. Yes, well...errrr.

Though to be fair to The Clive, it's not just him cashing in bigtime at BTO through this executive dilution program they run. All the directors are at it. Go have a look.

4/9/15

Panoro (PML.v) announces a PEA for Cotabambas

A hearty hoorah, a gasp, a muttering of 'Mirabile dictu' in the background, the impressively delayed Panoro (PML.v) PEA for its flagship Cotabambas project was finally announced this morning (though we don't get to see the document, that's another 45 days max and via SEDAR). However it must be said, the delay is the only impressive thing about this project. But hey, if you fancy risking one point four billion dollars with economics that...
  • depend largely on 521m tonnes of inferred resource grading 0.29% Cu (at a 0.2% cut off)
  • need copper at U$3.25/lb
  • have you happy about a 14.4% IRR
  • requires the wholesale relocation of the nearby town, or if not its living next to an open pit copper mine instead of its current pretty little bucolic Andean landscape
  • is run by complete bullshitters of the worst Vancouver type

...then don't let me stop you. Though the way PML dropped 23% on outsized volumes today is probably a better indication than anything ever found in IKN. Money talks, BS walks.


A power cut...

...a dental appointment and a slow news day.

You humble scribe suggests you find some other part of the interwebnetpipes in order to brighten your working day, kind reader.

4/8/15

Mexico mine bullion robberies: The difference between Silvercrest (SVL.to) (SVLC), Pan American Silver (PAA.to) (PAAS) and McEwen Mining (MUX)

When Silvercrest (SVL.to) (SVLC) has its Santa Elena mine in Mexico held up by thieves and valuable precious metals stolen, it tries to keep it quiet and refuses to disclose the event to the market. 

When Pan American Silver (PAA.to) (PAAS) has its La Colorada mine in Mexico held up by thieves and valuable precious metals stolen, it tries to keep it quiet and refuses to disclose the event to the market. 

When McEwen Mining (MUX) has its El Gallo I mine in Mexico held up by thieves and valuable precious metals stolen, it immediately discloses the unfortunate incident to the market.

So apart from the way that one company has measurably more respect for its shareholders, nothing much to report here.

IKN recommends: Glenn Chan's Random Notes on Investing

This is one of the finance blogs I read and agree with/disagree with in turns. But again, the key factor for sticking Glenn Chan on your reading list is originality: I do not want normal, boring, rote formula script when it comes to my business and financial reading. I want people who get me thinking and open my eyes to subjects that would otherwise pass me by.

So go and have a look at what Glenn Chan's Random Notes on Investing has to offer. If you do you'll see it's mainly about Canadian stocks, sometimes about mining stocks and always a smart read. You may well end up doing the same as your humble scribe and sticking it on your RSS, too.

Marc Faber on gold

Today we read that Marc Faber is bullish on gold. Now there's a ground-shaker:
Good Entry Point For Gold Right Now – Marc Faber
Gold’s volatility does not sway this famed economist as he thinks, regardless of recent gold market fluctuations, now is a good buying time. 
“My sense is that we’ve been at $1,921 on the gold price in September 2011, we’re now around $1,200. Well, I think this is a reasonably good entry point,” said Marc Faber, editor and publisher of the Gloom Boom & Doom Report, told Kitco News in a phone interview. Continues here

It's good that he mentioned that high point for gold in 2011, because we can now compare his views today with those on September 9th 2011:

Marc Faber: Gold is “Dirt Cheap” — Price Could Reach $10,000 per Ounce



Also, check out the bit where he told us in September 2011 that stocks are going to drop hard for years to come. But let's not restrict ourselves to one Faber Date, what about March 2012?

Buy Gold “Right Away” Says Marc Faber



Oh, there's a thing. And how about August 2013?

Jim Rogers expects higher gold, and Marc Faber does too!



Shocking surprise that one. And March 2014?

Why Gold Looks Better than the S&P: Marc Faber, PhD



We could continue. IKN therefore thanks Marc Faber for the messages on gold and has its own message for the gentleman:




Human beings are stupid, Chilean marijuana edition

Yesterday in Santiago Chile, we had the first ever legal harvest of marijuana in South America. Here and here are a couple of English language reports on the event, the second from AP including these extracts...

A Chilean municipality harvested legal medical marijuana Tuesday as part of a government-approved pilot project aimed at helping ease pain in cancer patients.
The harvest comes after Chile's first planting of pot for medical uses in October 2014. It is the work of a municipality in the capital of Santiago and the Daya Foundation, a nonprofit group that sponsors pain-relieving therapies.
...

"It's a huge achievement," said Cecilia Heyder, who suffers from systemic lupus and was diagnosed with breast cancer in 2011. "I just wish all of Chile's municipalities could achieve this as well."
Continues here.

So now the fun bit, the images from the event yesterday such as "media scrum for the special award-winning angle of thing that's been growing out the ground for thousands of years"...


...and of course "smart qualified people in white coats with plant":



It begs questions. Why can a plant daring to do what it's done naturally for all of history, i.e. growing, be news? How can a plant be against the law? What part of a seed's germination is a crime? What's with the white coats and gloves anyway? Marijuana isn't normally a thing in our eyes but a concept, it's easier to handle the supposed illegality of marijuana when it's framed as the effect it has on people (REEFER MADNESS!) so on occasions such as the big photo-op yesterday we get a sideways glimpse of how incredibly stupid it all is.

It stems (no pun intended) of course from fear. Human society is afraid of the marijuana plant because of its potential to wreak havoc on our form of society, the group ethic and way in which we must all pull together and work as a team in order to progress. After all, we don't want anybody lying around enjoying themselves now do we? There's work to be done. It is therefore bad, oh you naughty plant, but come the scientists who can take the bad and turn it into good and we are all saved. "Look everybody! We're SCIENCE so now the naughty little delinquent is under our control, it cannot corrupt us any longer, we have tamed it and will use it well". Marijuana is now useful to us, therefore we can rest easy, science has saved us again.

It's the same human conceit that will see us as a species die long before marijuana does, a living thing that will enjoy global warming far more than us.

Endeavour Silver (EDR.to) (EXK) 1q15 production

Here's the NR, here's silver...


...and here's gold.


Then if you read the NR there's the normal gum-flapping from Bad Crooke. Number of reasons to own this while silver's under $20/oz = Zero.

4/7/15

More news from miner-friendly Mexico

Robbed McEwen



TORONTO, ONTARIO--(Marketwired - April 7, 2015) - McEwen Mining Inc. (NYSE:MUX)(TSX:MUX) is extremely disappointed to report an armed robbery occurred today at our El Gallo 1 mine in Sinaloa, Mexico. An estimated 900 kilograms of gold-bearing concentrate containing approximately 7,000 ounces of gold were stolen from the refinery. The crime is being vigorously investigated by the Mexican authorities.

The Company maintains insurance against these types of incidents and is working closely with its insurance carrier to determine the extent of available coverage. However, the Company's policy will not be sufficient to cover the entire expected loss.

No employees were seriously injured and there was no material damage to any of the Company's facilities. Mining and processing activities have not been impacted and continue uninterrupted. Continues here.

Sandstorm (SAND) (SSL.to) is still throwing good money after bad

Nolan Watson just won't learn. First he goes all-in Colossus and gets smacked upside the head. Then he pumps extra cash into Luna Gold, only to watch it dissolve into nothing mere months later. Now (and as predicted by IKN) it's the turn of the woeful scam Metanor (MTO.v) to benefit from the largesse at SAND.

Guess which company contributed $940,000 to the recent $3m MTO bailout fund? 


Nolan should consider adopting St. Jude Thaddeus as his patron saint.

UPDATE: Hi Nolan!

The Kitco monkeys with dartboards are back!

Oh Kitco, thanks for the laugh this morning:



The thought strikes your humble scribe as to just why Kitco decided the put its gold survey "on hiatus". Could be perchance be anything to do with the way in which IKN followed its predictions and carefully recorded each week's results for a full year to confirm that it's a total waste of time? This from the final post in that long series:
"The result: After 52 weeks, the experts were right 17 times. That's to say, they score one in three on a survey that offers three choices. The same one-in-three ratio comes when you only count the "strong signal" weeks, too. They are indeed monkeys with dartboards and believing what these people say is a total waste of time."
And then , just a few weeks after that, "the hiatus" came. Probably just coincidence guv, innit. By the way, if you want to read more of that series just stick "IKN" and "monkeys with dartboards" into the Googlymachine.

So anyway, we now get to watch the monkeys with dartboards compete against the Kitco readership, the very same people who confidently and overwhelmingly predicted that Switzerland would vote to back its currency with gold last November. A year of guffaws and chortles await us all.

price to book on miners

A slightly flawed but still very decent little article on whether using price/book to value mining companies is the right metric, over at Mineweb today and on this link. For me, yes it's the right place to start. Then again, a balance sheet bore boy couldn't possibly say anything else.

UPDATE: A query comes flying into your humble scribe's mailbox on the use of "slightly flawed". Here's what prompted that comment, from the Mineweb piece:
"...the price-to-book ratio is used to compare a stock’s market value to its book value, and is calculated by dividing the current closing price of the stock by the latest quarter’s book value per share. In essence, a P/B ratio of 1 would mean that a share is fairly valued."
If you can define fair under this criterium, you're way smarter than I.



UPDATE 2, early evening. This post was published early Tuesday morning, some 12 hours ago. It's been nagging and gnawing at me all day, something wasn't right, but until about 10 minutes ago I couldn't put my finger on it. Then it suddenly came: Walt Whitman.
When I heard the learn'd astronomer,  
When the proofs, the figures, were ranged in columns before me,  
When I was shown the charts and diagrams, to add, divide, 
and measure them, 
When I sitting heard the astronomer where he lectured 
with much applause in the lecture-room, 
How soon unaccountable I became tired and sick,  
Till rising and gliding out I wander'd off by myself,  
In the mystical moist night-air, and from time to time,  
Look'd up in perfect silence at the stars.

And now, relax.




A Flash update...

...has just been sent to subscribers, 06:45am local time on a very pleasant and sunny Southern Hemisphere Tuesday morning. Shifting chips around.

4/6/15

A modest proposal: A proxy slate to kick out the directors at Great Panther Silver (GPR.to) (GPL)

They tell me that if you start a post title with "A modest proposal" it sounds all Swiftian and 18th century ironic, thereby creating that intellectual amusement scenario preferred by the discerning bloggists. Well yeah, all good, except that I'm actually serious about this. 

1) It's fairly obvious that Great Panther Silver (GPR.to) (GPL) is a loss-making mining company. After all, these days you don't even have to look at the pre-tax or net earnings...


2) ...because  it can't even make a profit on its mine operations.


3) And it's also pretty obvious why that is:


4) We could string this out to a few thousand words, but the crux of the matter is that GPR can't make a profit with silver this low and that's not a guess, it's now proven. And with 2015 cash cost guidance at GPR higher than the silver spot price, the writing is already on the wall for this year. Therefore the question arises as to just why it's continuing to produce. Surely it would be smarter to take its non-renewable fixed asset resource and put it on care and maintenance. What's the point of going to all that trouble of digging up the silver and other credit metals when you can't do it at a profit? I mean, forget the padded out G&A, forget the tax, don't even include the money it's been wasting on what they optimistically call "exploration", this company cannot even make a profit in the most basic of baseline levels, that of 1) dig out rock 2) put it through machine 3) sell the result to someone waiting at the gate.

In fact, the only people making any money are the directors of this loss-making show, who are relaxed about running their company at a loss as long as those six figure salary cheques keep hitting their personal bank accounts. The CFO, the COO, the VP Expl all with tasty cash packages and Robert Archer all by himself pulls down half a million a year in cash, aside from all the extra benefits. And it's not as if they have a whole bunch of shares and skin in this game either, as all the company directors put together own less than 4% of GPR.to stock. All that cash, none of the responsibility, nice work if you can get it, right Bob?

Common business sense is to close down a mining company that can't cover its fixed costs, one that cannot even run at gross profit. And common business sense also demands that you kick out fatcat directors for doing a bad job. These richly paid wastes of time don't care as long as they get their wedge, so the only way to protect shareholder value is to run a proxy on Archer and his band of good for nothings, vote them out, ask them to be careful the door doesn't hit their asses on the way out, stop fracturing company cash into their back pockets, mothball GMC and Topia, then wait until silver prices can justify their mining before turning the lights back on.






First Majestic (FR.to) (AG) runs a bought deal

Over the weekend, this humble corner of cyberspace announced its decision not to use strong swear words any longer on its pages. I'm now regretting that decision.

Here's FR.to taking the Great Panther growth route:

First Majestic Silver Corp. (TSX:FR)(NYSE:AG)(FRANKFURT:FMV)(BVM:AG) ("First Majestic" or the "Company") has announced today that it has entered into an agreement with BMO Capital Markets ("BMO"), under which BMO has agreed to buy on a bought deal basis by way of private placement, 4,620,000 common shares (the "Common Shares") of the Company, at a price of C$6.50 per Common Share for gross proceeds of C$30,030,000 ("the Offering").
The Company intends to use the net proceeds of the offering for general working capital and ramp development at the La Guitarra Silver Mine from the Coloso mine to the Nazareno area with the aim of bringing Nazareno online by year end and advance the permitting and planning process to develop Mina de Agua and El Rincon areas at La Guitarra. In addition, the Company intends to begin the planning process at the Plomosas Silver Project in Sinaloa for the preparation for a future Preliminary Economic Assessment (PEA). continues here

This compares to its statement on Feb 23rd when announcing its year-end numbers:
The Company is currently in open discussions with various financial partners to reduce or extend payments on certain current liabilities in order to strengthen the working capital position. Based on the Company's current operating plan, the Company believes it has sufficient financial resources, combined with cash flows from operations, to meet its ongoing requirements.

It took six weeks for "sufficient financial resources" to turn into a bought deal and share dilution. Looks like those open discussions closed down all of a sudden.

Latin America Daily Briefing

For those of you who want a one-stop summary of the main stories in Latin America, all in English, make Latin America Daily Briefing your secret weapon. 

The IKN Weekly, out now



IKN308 has just been sent to subscribers. Has word and pictures.