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4/28/17

The Friday OT: Claude Debussy, Claire de Lune

Thomas Labé plays one of the world's most recognized piano pieces.



To drift quietly into the weekend, smile on face. Youtube here.

Just so we're clear about Rye Patch Gold (RPM.v)

It definitely has run out of cash and it definitely will finance again very soon. So stop mailing me with your stupid guesses about royalty payments being enough, dumbasses. You don't know what the fark you're talking about and if this is the way you go about your mining investment, you'd be much better off sticking your whole wedge in a time deposit and dedicating your time to learning something more productive to your life, such as macrame or competitive trainspotting or coupon swap evenings. Freakin' twats. End of rant.

Barkerville. Eric. Sean.

Enough readers have mailed in already to correct me, and quite right too, so a quick post here. Yesterday in this post I incorrectly implied that Barkerville Gold (BGM.v) was a Sprottstock. Yes it was for a while, but I'd forgotten that Osisko/Roosen had bought the Sprott position out and is now the head cheese there.

The funny thing is, that second paragraph works just as well if you extract the name "Eric Sprott" and replace with "Sean Roosen". Lackeys is as lackeys does.

Regarding mining stocks and humility

A major aspect of following, investing, speculating and analyzing in the mining sector and its companies, particularly the junior explorers and producers, is that every now and again you go through a week in which seven bells are kicked out of your portfolio. It could be for one specific reason that hits across the board or is could be for disparate factors, but sure as eggs are eggs it's an experience you'll go through. It's been my "pleasure" this week so, in The IKN Weekly edition 415 on Sunday, there's bound to be reflection on that. 

Sorry ladies and gentlemen, this sector isn't all about "winning", "killing it", "crushing it", 100% guaranteed success, it's about staring reality in the face and, if you're up to the task, learning from the experience. Or as Hugh MacDiarmid wrote in "On A Raised Beach":

We must be humble. We are so easily baffled by appearances
And do not realise that these stones are one with the stars.
It makes no difference to them whether they are high or low,
Mountain peak or ocean floor, palace, or pigsty.
There are plenty of ruined buildings in the world but no ruined stones.

What happens to us
Is irrelevant to the world’s geology
But what happens to the world’s geology
Is not irrelevant to us.
We must reconcile ourselves to the stones,
Not the stones to us.

4/27/17

Sandstorm Gold (SAND) (SSL.to) in the next edition of The IKN Weekly

In The IKN Weekly this weekend, your humble scribe will explain why John Doody is a freaking idiot.

By mouthbreather demand: IKN writes nice things about a junior mining stock

I'm getting another round of dumbasses asking me why I'm so negative on the mining industry, why I always post nasty things about juniors, why don't I have a life and seem to be such a bitter twisted piece of crud and, just to prove they don't have the first freaking clue about the word, asking me why I'm such a troll.

Yes indeed, another day in mailbag paradise, wading through mouthbreather mails and their painful grammar.

But hey, I'm supposed to be a capitalist and want growth and recognition and the customer is always right and all that shit, so today I've decided that it's time to kow-tow to the market braindead and give them a reco for a stock that's truly worth their time owning. By way of disclosure, yes indeed I own shares in the company I'm about to mention and it's also covered in The IKN Weekly, so I'd assume a portion of IKN Weekly subbers also own some. I bought at lower prices and have a target that's substantially higher than today's market price, so I'm not trying to rip you off like Marin Katusa does and sell into any new buying, I'm a strong holder until my target is hit. This stock is going to have an excellent financial 2017 and the next quarter in particular is set to be a blow-out, which will make all the sell-side anal ysts who doubt its balance sheet STFU once and for all. So buy yourself some Atico Mining (ATY.v) mouthbreathers, anything under 70c is a drop-dead knockdown bargain, even paying 80c is dirt cheap and a no-brainer. Which is perfect for people like you.

Have a nice day. Love and kisses, Otto.


Mailbag. Detour. Goldcorp.

Main man mailer 'H' today asks:

If Detour drops by a third, I have to think it would get GG's attention and warrant a bid.  Thoughts?


The IKN reply: If Garofalo is crazy enough to buy Caspiche and half of Cerro Casale, he's crazy enough to buy anything. In fact, if I were CEO of ITH, GOLD.v, CKG, NG, NAK, VGZ or any other of these low grade wastes of time that only a geologist could love, I'd be mailing him every other day.

Barkerville Gold (BGM.v): Ah wuz shocked...

...to learn that on the back of its grade-smear bullshit NR, it now wants you to exchange over thirty million of your dollars for its newly printed paper. That this utter joke has a market cap of over $300m is off-scale crazy. That it gets a bought deal at these levels is an indication of the way in which the brokerage houses are in cahoots with these liars and thieves.

Why is it that these days, in 2017, you'll hear howls of derision when recidivist a scam junior explorer tries to scam the idiot mouthbreather end of the market, but not a peep when it's an Eric Sprott company?

UPDATE: And ah wuz shocked when they upsided the bot deal. Shocked.

4/26/17

New Gold (NGD): And for the first quarter in living memory...

...New Gold (NGD) has managed to file its quarterly financials, its MD&A and the accompanying news release without adding to the capex or further delaying the construction timeline of Rainy River.

The IKN theory on the new US government's tax reform plans*

They've decided to make the proposal so fucking stupid that it doesn't have a chance in hell of passing. End of theory.

*You see how I managed to avoid the T word in the title?

The Paul van Eeden "Better Sleep Principle" and Rye Patch Gold (RPM.v) (from IKN412)

A little background is needed.

1) The IKN Weekly has a "15 stocks maximum" holding policy. There are several reasons for this, but the main thrust is to promote portfolio discipline and keep things real.
2) In IKN 412 dated April 9th I had 15 open positions and decided I wanted to buy a new one. Therefore, one of the open stocks had to go.
3) Even though I'd just run the numbers on Rye Patch Gold (RPM.v) in IKN411 in light of its news of the receipt of its long-delayed cyanide usage and decided to hold through, it was RPM.v that got the chop.
4) Since that date, RPM.v has dropped 22.4%. I got out with a small profit, which after commish wasn't much more than breakeven. In other words my trade was a real world failure, but it would have been worse if I hadn't paid heed to Paul van Eeden's "Better Sleep Principle". 

Read on (name of new purchase edited):

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Rye Patch Gold (RPM.v): SELLING: The short story; to make way for the new position in (EDIT) and to maintain the integrity of the “15 positions maximum” philosophy* here at The IKN Weekly (though I have bent the rules a couple of times over the eight years) something has to give. That’s RPM.v and so I’m going to sell this position in the next five days and close the position.

The slightly longer story; Even after running the numbers last week and summing up by writing a conclusion along the lines of...

  • Good news about the permit arrival
  • I’m holding on the numbers and its potential
  • But financials and cash position now look tight
  • And if they decide to run a placement it will be a bridge too far and I’m out

...as the week wore on that uncomfortable feeling about the corporate balance sheet came back again. I want to believe in this story because, if it goes to plan, RPM has a great looking operation at Florida Canyon that’s currently heavily discounted. The problem is, my wanting to believe ended in me deciding to ignore the risk that RPM dilutes my shares in a final, top-up placement which would deliver my profits to somebody else. And on re-consideration it’s more like a probability than a possibility, plus rumours about things not going as well as we on the outside would like at Florida Canyon have not gone away and keep coming around. If things had run more smoothly on the permitting track it would be much easier for me to brush off the chatter-talk and have more confidence in RPM, but where we are today and how we’ve got here means that I don’t. It’s at the stage where I’m worrying about this trade and it floats back into my brain at nighttime...not a good sign at all. I’m a long-term fan of Paul van Eeden’s “Better Sleep Principle” and here’s an excerpt from one of the times he’s written about the concept (8):

“This is where the Better Sleep Principle comes to play. I had not really thought about it but I have for many years now subconsciously followed the Better Sleep Principle in my own investing. It works like this:
If I start worrying about something when I go to bed at night I fix it the next morning. For example, if I own too much of a stock and am concerned about what would happen if the price falls, I sell some. If I don’t own a particular stock and I lie in bed worrying that the price would go up before I get a chance to buy it, I buy some. I do whatever it takes to make me sleep better at night.
Here’s why you should follow your own instincts to make sure you sleep well at night: it doesn’t help if you follow someone else’s advice and they sleep well while you lie awake. Investing is a very personal endeavor; only you know what you need to do.”

Result: When I made the decision to buy some (EDIT) last week it was easy to choose which company to drop from the ‘Stocks to Follow’. It means it’s likely to be a booked as a small profit of little consequence, but even if the price dives next week and it is closed at a minor loss it’s still nothing much more than a failed breakeven trade, 10% either side is not why I buy junior mining stocks. So, rack it up as another IKN Weekly failure, not the first and won’t be the last.

*Perhaps a bit too grand, it’s an idea.



The other thing about this Sandstorm (SAND) deal is the newco market cap

When SAND is joined by MARL, we're going to be close to the U$1Bn market cap threshold, something that Nolan Watson has been keen to promote as a target due to the way it will open up the door to a new tranche of insto cash.