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2/21/09

Quiztime!


Here's another chance to show me just how smart you are. First correct answer wins...errr... something nice. You choose what you want. You have until tomorrow morning to get your answer in, either underneath in the comments section or by mail to otto.rock1 (AT) gmail (DOT) com. G'luck!
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As regards the year 2009 to date, what do the following Heads of State have in common?

Michelle Bachelet (Chile)
Hugo Chávez (Venezuela)
Alvaro Colom (Guatemala)
Rafael Correa (Ecuador)
Cristina Fernández (Argentina)
Martín Torrijos (Panama)

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Colombia: Another day, another gov't human rights abuse: But this one is big.

The Colombian weekly magazine 'Semana' has today broken another big story. Those Spanish speakers amongst you should stop reading this, go here immediately and read the report, but as a quick resumé of Semana's scoop:
  • Colombia's official snoops, the "Departamento Administrativo de Seguridad" (Administrative Department of Security) normally known as DAS has been eavesdropping on anyone and everyone regarded as a 'threat'.
  • The list includes opposition leaders, journalists critical of the government, members of the judiciary that have been heading cases against government officials, government functionaries and civil servants.
  • Just before a new head of DAS took up his post on January 22nd, mountains of documents were secretly destroyed by DAS. An anonymous whistleblower who works as a detective at DAS (obviously anonymous, as if his identity were revealed he could probably count his life expectancy in minutes) told Semana (via Ottotrans™):
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"We received the order to collect everything we had in several offices in the building and in external centres and take it to the Counterintelligence. For two days we collected portable hard drives, we changed computer hard drives, collected CD-ROMs, voice archives and confidential documents. I alone, not counting my colleagues, took two boxes full of these things.

"Of all the boxes that were taken to Counterintelligence, with documents, recordings and such, only one survived, which was taken out of the 11th floor on Wednesday afternoon. I don't know what was left in it or where it was taken. I just know that everything else was destroyed."
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  • But possibly the most damning and chilling aspect of the Semana report is the allegation, backed up by its anonymous sources, that DAS ran a network of information sales and would sell official intelligence to narcotraffickers, paramilitaries and guerrilla groups such as the FARC. In a country with an appalling record of extrajudicial killings, union leader asassinations and attacks on judicial bodies, this is an astonishing revelation (though it has to be said, hardly a surprise for those who have followed the rise and rise of Alvaro Uribe and his pseudo-democratic government).
Let's see how much of a fuss is made of this story amongst English language media sources. Colour me cynical, but don't hold your breath up there.......



UPDATE: Good English language site Colombia Reports has its take on the story here.

Carnaval Time!

While you guys up North shiver your way through the end of winter, down this neck of the woods Carnaval period is in full swing. The most famous event is of course in Rio de Janeiro, Brazil, but carnaval is celebrated up and down the region in different forms and guises.

Here are a couple of photos from La Paz, Bolivia yesterday. Both feature a dude named Morales, best known as a cheeky, raffish bachelor boy who has sired children out of wedlock, is currently single and obviously has an eye for the ladies. Some people may also recognize him as the President of Bolivia.

SillyFoam is an integral part of carnavales. This is why the party will never take off in the North.
Thank Greenpeace, not me. By the way, she got the greatest smile or what?


This one has "Caption Competition" written all over it

Which reminds me; this year at Bolivia's biggest carnaval bash, the Candelaria in Oruro, authorities are distributing 22,000 condoms free of charge to the revellers.

¡Que Viva Carnaval, Carajo!

Doug Schoen is funny

Even the WaPo gets the joke. Here's an extract from its review of his new book, "The Threat Closer to Home" (yeah, it's about Chávez..how did you guess?)

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".....Schoen and Rowan undermine their argument with hyperbole and unsupported allegations. On the first page of "The Threat Closer to Home," they write that "Chávez arguably presents a greater threat to America than Osama bin Laden does on a day-to-day basis," but they make no case that Venezuelaintends to attack the United States or help others to do so. They repeat a litany of previously published allegations about Chávez's support for Hezbollah and his close relationship with Iran's Mahmoud Ahmadinejad. But they do not add anything to the factual record, nor do they attempt a coherent explanation of what the two radical leaders are up to. The authors allege that Hezbollah operates "at least five training camps in Venezuela," but they offer no evidence for this. There is not even a footnote to buttress that sentence or the following one: "Hamas and even al-Qaeda have sent members to Venezuela to avail themselves of Chávez's hospitality."......"

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For those not versed in review-speak, this is as close as a publication like WaPo can get to saying "bullshit" without worrying its lawyers.

Books like this = more proof that you gringos will buy anything. Do you guys want to find out what Venezuela is really like, or do you want even more excuses for a baseless hate campaign? If you raise your hand on the first option, I got a good idea; why not find out what Venezuelan people think and do when faced with wholesale media lies.



It's a quiet Saturday out there, so sit back, click that button, relax and watch "The Revolution Will Not Be Televised", one of the most amazing documentaries of all time. You'll find out far more about Venezuela in an hour than you would spending a year in Doug Schoen's company. And once you've watched it, take a wild guess as to why the distribution of this documentary* is still banned in the United States of America.

Censorship in the USA? Shome mishtake shurely ossifer!

*Miriam Webster Dictionary: "Factual, Objective"

2/20/09

Still don't believe that US reporters lie to you about LatAm?

Well read this.

Some idiot who thinks he's special because he got hired by The Washington Post named Joshua Partlow has been conclusively shown as a know-nothing liar and peddler of proven falsehoods that were ordered retracted by court order over a year ago. And surprise surprise, Partlow was spreading BS muck about...wait for it.......roll on the drums....yes....you've guessed it already...Venezuela, Bolivia and Ecuador! Wow, shocker, huh?

All this thanks to the diligent work of excellent (and I'm proud to say long-time linked here) blogs Abiding In Bolivia and The Mex Files (and their own mini-eminence gris Utpal.) Click on the blognames to find the full exposés to Partlow's lies. Good work, guys.

So Joshua, you receive an award that so many professional journalists who read IKN have deserved this week. All yours, dumbass:

Troy Resources (TRY.to): Still extremely undervalued

With Troy Resources (TRY.to) (TRY.ax) currently sitting at $1.13, the writer of this missive is 35% in profit on the position first recommended late December and taken in January (after waiting for my price to appear).

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However this doesn't mean that, compared to other gold plays, the value is now gone from a new position in TRY.to. Far from it, as the people who bought a copy of the NOBS report (see that subtle pump? Click that link for the details) will know that at U$1,000/oz gold the NOBS 12 month target for TRY.to is way higher than today's price. In fact, even $900/oz is more than a double from here.

Several people have asked me for a good gold play as they've watched Au climb. I can see no better out there right now. The $1.13 of today is a tremendous bargain and as the volume bars show on that chart above, the company is still thankfully flying under most radars.

Want a gold miner? Buy Troy Resources. DYODD, dude.

Disclosure: Yes, I own. Can't you read?

Trading Post ($1000/oz edition)


So gold goes through $1000/oz. I didn't think it would get here on this direct push, being one of those wishy-wishy "needs to consolidate" people with no gumption or whatever. Anything with the words gold or silver in the name is up, basically.

Citigroup (C) down 28.69% at U%1.79. You think I don't follow things up there? I know Vikram Pandit is still there, my only question is "why?". I look at C and all the banking sector and can't help wondering about immediate deflationary risk soaring. Call me an old humbug if you like...

Cosan (CZZ) down 5% at U$3.40 today. Here's a nice brief research note on sugar published today by a bunch of Germans in suits. It's very good, in fact, and thanks to RS for passing it on. Recommended reading and another way of seeing why your humble correspondent likes the sector going forward...esp CZZ.

Kinross (KGC) up 4.5% at U$18.92. Mailer RC today took issue with my claim that K's 4th quarter sucked. Well that's ok, we can cut'n'slice the numbers in different ways. From the action today K is enjoying the gold bounce like all the others, so WTFDIK, anyway? Hey, I still nailed the drop yesterday before the bell, RC....can't take that away ;-)

Dynasty (DMM.to) up 9% at $5.56. w00t! w00t go! go!. The same mailer RC everso slightly chided me for lightening DMM.to in two places on the way up, too. Don't worry dude...I still got plenty on board. Gravy time!

First Majestic Silver (FR.to): Avoid

On Wednesday evening, after the bell, First Majestic Silver Corp (FR.to) announced this $25m financing (10m shares at $2.50 a pop, half warrant at $3.50 attached). Ok, yeah well, another dilutive placement. But if you look at Wednesday's trading patterns it's clear that Da Boyz were once again screwing people over with insider information.

You know the last time FR.to traded 550k shares in a day? November 10th 2008. The most trade in a quarter as the stock sinks...hours before a nasty dilution that halted next morning 's trade and then saw it drop 22%? "Whatever makes you suspect insider dealing, Otto?" And hey wow! looky...

......silver actually went up on the same day. Yup, every reason to sell a silver miner.

Yesterday I mentioned I was mad about this and would write a long post explaining things. Well I've calmed back down to my normal cynicism in the last 24 hours and I decided not to write all I could write about FR.to and the brokerages. I don't thrive on bile and all this stuff about Stanford and everything has started to wear the anger-meter out too much. Suffice to say that this week is another good example of the cozy Canadian mining game, where everyone wins except well-meaning retail shareholders that try to be loyal to a stock.

The toothless and impotent OSC just turns a blind eye to this illegality. You're on you're own, I'm afraid, so in my personal opinion FR.to is another one for the list of easily avoidables. Don't buy it, don't sell it, don't short it. Just avoid it. Vote with your feet.

Chart of the day redux

Today gets a double helping, as somebody in COMEX obviously has a sense of humour.


Spot gold now $990. Nuff said.

Brazilian unemployment doomsayers need to look more closely

Amongst all the usual morning financial newsflow down here today one story is getting put head and shoulders above the rest headlines-wise. Brazil's unemployment rate has shot up from 6.8% at end December to 8.2% at end January 2009.

Here's the Bloomberg version of events in English, and oh my how breathless it is, telling the world how it's "the biggest jump in seven years" (help!) how "Brazilian companies are slashing output" (HELP!), how the "crisis chokes demand and commodity prices plummet" (HELP!!!!).

Argentina is trying its dose of Shadenwhatnot, too. Clarin for example reports that qualified technicians are very much included in this round of redundancies, with the 4,000 layoffs at Embraer yesterday (not included in the January figures, of course) a typical example.

OK, cut the crap here. I may not know Brazil as well as guestblogger Lime Slime, but I know when I'm being fed a ton of statistical BS. Look at this chart, please.

Oh look! (part one): Unemployment is way down in the last 18 months. Yep, we're a long way from those 9% and 10% numbers, aren't we? And if you bother to look back further, Brazil's headline PME unemployment rate was still topping 13% as late as 2004.

Oh look! (part two): Unemployment always drops in December and climbs sharply in January. If you bother to think about it for more than a second, it does make sense. There's something called "summer" this time of the year down this way, which can involve things like "vacation" and "factory closedown" and "black market job selling corn on the cob or shrimp kebabs on a sunny beach". It also implies, "That temporary Christmas job is open for you next year. Thanks for doing a good job as usual, Joachim."

Etc etc. I'm not saying that Brazil has miraculously escaped the world recessionary pressures. I am saying that the prophets of doom, as usual, will find enough information to spin their 'end of humanity as we know it' stories. Be careful out there and use your own brain, as the media still has this habit of lying through its teeth at you.

Chart of the day is......

....Peru's mining exploration activity, 2008 and 2009.

Figures according to César Vidal in this report. Vidal is the head of explorations with Buenaventura (BVN) and the President of Peru's ProExplo (a national group covering all mining exploration work in Peru). Basically, if he doesn't know, nobody does.

Remember, folks. The Peru government says there's no recession, so it must be true. Right?

Happy Birthday, Mrs President


Happy birthday, Cristina Fernandez de Kirchner. No snark in this post as it matters not what I think about your presidency and administration, I just hope you have a nice day. Eat some cake, put on a party hat, dance the conga.

2/19/09

WE FOUND YOU, WALDO!

Nadagold (NG): If you'd listened....

.....you'd be short at U$3.70 too, just like your horntootin', smug (and somewhat richer) Otto. And before you open up the e-mail page, I know just how annoying I am. No need to remind either myself or my family. And no need to question the legitimacy of my parents' state of wedlock at the time I was born, either.

The short only started on Feb 5th but not covering yet. No way José.

Rusoro: "THE BID IS DEAD" (an IKN exclusive)

Oh this is fun, I get to break an exclusive! After hitting "publish" on the trading post underneath I got in touch with George Salamis, President of Rusoro (RML.v) and asked him his views. He told me about what was going on with the courtroom appeal application reported today and I said, "Hey, that's good copy, mind if you go on the record with that?" Here agreed and here's the result. Salamis exclusively told Inca Kola News;

"It's hugely unfortunate that investors view (according to the share price of today) that this appeal represents new life for the bid.

"A couple of things to make clear. One, the bid is dead. We are not entertaining any discussions with, or about, Gold Reserve whatsoever. Two, we were extremely disappointed wth the findings of the court on matters of both fact and law. Accordingly, we have followed through with our public commitment to our shareholders to vigorously defend ourselves. Any success in the appeal will clarify our legal position, but we should be clear; success on this appeal will not trigger the revival of the bid."

UPDATE:
Reuters playing catchup

Trading Post (smell the coffee edition)


Gold Reserve (GRZ) up 20% at U$0.73. The shareholders in this stock make me laugh. GRZ sinks to nowhere in five trading days once Rusoro's hostile bid is taken off the table. Now today Rusoro and Endeavour go back to the courtroom to try and revive the possibility of bidding and GRZ zooms...AND THE SHAREHOLDERS STAY LOYAL TO BELANGER!!! Look...let's make this as plain as possible, people. The current management is clearly not adding a cent's worth of value to the stock. The people who'd like to take over are. The market is telling you that, loud and clear. You can try dressing it up in russky fearmongering stories and tales of megadilutions, but money talks and bullshit walks in this game. Ask your back pocket who it prefers. Nuff said.

Dynasty Metals (DMM.to) up 5.3% at $5.16. Yeahbaby, show 'em what you can do! The $10m placement has just closed successfully, by the way. I pared down slightly at $5 as planned but I'm rootin' for you, Washer. Volumes low today, however.

Kinross (KGC) down 6% at U$18.32. Your humble correspondent said before the bell today that it'd dump on last night's mediocre earnings report. And it did. Just sayin', ok?

First Majestic Silver (FR.to) down 19.3% at $2.26. I'm mad as hell about this move today and i'm going to tell you why in a post later. If anyone dares tell me that the Canadian markets aren't crooked after this charade they must live on the Planet Zog or something. A shameful episode to add to thousands of others in the anals (deliberate typo) of the Toronto Stock Exchange.

Two news stories and no Allen


As usual there is more than just one story this side of the Darien Gap, so here's a two-for-one memo about things more political. And apart from the mini-scoop of the previous post maybe it's better to check for Stanford stories in the larger blogs and MSM than here. I'm going to try and avoid too many posts on the subject now (though temptation is always there and a few may slip through in the days/weeks to come).

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In Peru another crap minister bites the dust. Interior Minister Remigio Hernani has just resigned this morning and will be replaced by another crappy politician, APRA stalwart Mercedes Cabanillas. Hernani was hurt by a bungled and frankly amateur recent police raid on land squatters that ended up with three cops shot dead, but he was under pressure due to his total mediocrity from the moment he got the job (he came in via the Yehude Simon new broom of late last year...what a total flop that was).

So anyway, Peru now has the amazingly annoying Cabanillas as a minister. The Twobreakfasts admin just gets worse (yes, it was possible).

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In Ecuador, Studmuffin chucks out another US diplomat and leaves us thinking of Oscar Wilde's The Importance of Being Earnest:

"To lose one parent, Mr. Worthing, may be regarded as a misfortune. To lose both looks like carelessness."

Check out that link above for the full story, but expect a big hoo-hah on this one to reappear when Saturday's installment of Radio MUFN comes around. Da Prez is now campaigning, remember, and he'll milk this for all he can.

Stanford and drugs: an interesting coincidence


There's a lot of speculation and chatter about possible connections between Cur Allen Stanford and the heady world of narcotrafficking this morning, but away from pure jawboning there is a solid and verifiable link between Stanford and the world of drugs.

However, it's...err...ahem...on the other side of the ....errr...coin. A guy called Tom Raffanello is (or perhaps was) head of the Stanford Financial Group security department. The thing is that once upon a time......errrr.....how can I put this?...hmmmmm....he was head of the Miami DEA! Yep, true, here's a link to Google returns that show our friend Tom was a DEA guy way back then.

Now, of course, we all know that the Miami DEA fight drugs to man and never take bribes and don't have the slightest suspicion of wrongdoing in their illustrious and squeaky-clean history.

All the same, quite a coincidence, n'est pas?

Full IKN Stanford coverage found here

All gold resource ounces are not the same

Cerro Casale: Mucho altitude, mucho prettiness

So on with the show, mineheads. From time to time , normally via mail (but sometimes it's addressed on blog), the subject of in situ gold ounces comes up chez Otto. This is fresh in my memory because a couple of days ago I had an exchange with one reader who questioned the amount of in situ gold ounces held by Troy Resources (TRY.to) compared to its share price valuation and my recommendation and price call (this person had bought the NOBS report and follow-up questions, which is always good to see).

Now this is a big subject, but the general statement that "all gold resource ounces are not the same" is something that holds up in all discussions on the subject. As an example, let's look at this report on Kinross and CEO Tye Burt's Conference Call today, specifically about the Cerro Casale gold project in Chile.

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"........In the previous resource and reserve estimate, the reserves stood at 23-million ounces of gold and six-billion pounds of copper. However, based on "re-engineering and optimisation decisions", the proven and probable gold reserves have been reduced by 800 000 oz, Burt said. The updated reserves were calculated at a $725/oz gold price and $2/lb copper price. "Obviously that is above today's spot copper price, but I would say, based on the prefeasibility work that we have done with Barrick, and the current technical view, that it does have positive economics at those numbers," he said. Optimisation work under way for the full feasibility study would also likely improve the economics, "and of course we are looking at ways that we can lock in some of the commodity prices", Burt said....."
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So, history and technicalities of Cerro Casale aside, note that Tye Burt is saying that there's 23 million ounces of gold there but they're having to re-do, re-think and get all smart and busy on the engineering just to make the project feasible with gold at $725/oz and cu at $2/lb. That's twenty-three million ounces, folks! If you have to get the smartest mining engineers in the world together and bang their heads together for years on end until finally they work out a way they might....MIGHT... be able to build a profitable mine there's a lesson to be learned by us mortals, no? An ounce of gold up there clearly isn't the same as an ounce of gold in one of those Mexican heap-leachers.

To repeat and be totally boring: Does that sound easy mining like, say, Yanacocha to you? Does that sound like a low cash cost per ounce project? Does that sound like low capex in the pipeline? Nope, me neither. That's because all gold resource ounces are not the same.

To return to the heights of Chile for one more paragraph, that's my problem with places like ADM.v at Volcan and that dreaded XRC.v thing called Caspiche. For example, pumpers of ADM.v will tell you "it has 10m oz, dude". Sometimes they'll even tell you something more accurate and tell you it has under 5m of recoverable ounces so far outlined. But what they won't tell you is the enormous engineering, logistical and price barriers between Miner X and the possibility of getting those ounces (mostly very deep, too) out of the ground and into a bank vault in Switzerland. And when I say "they", that most definitely includes some of the better-known newsletter writers and also people sitting in offices in Canada with CFA after their name that write touchyfeely client reports promoting these companies.

Finally, believe it or not but this isn't just my little pet peeve; due to the nature of the game I speak to geologists on a regular basis and one highly respected professional in the field who knows the Chilean heights very well has told me on more than one occasion that in his opinion Cerro Casale will never be a mine. He's not bearing a grudge or with skin in the game or similar; he just says it as a rockdude wearing his hardhat.

OK, rant over. Thank you for bearing with me.

Chart of the day is........

....Kinross (KGC) 12 month price chart.......

.......because its 4q08 results sucked.

Yeah they did. Sorry. Even backing out the big charge Kinross took against the Bema acquisition the EPS of $0.09 missed by three cents. Here's the company PR if you fel like getting the sanitized version, but unless gold rockets today Kinross is going South.

2/18/09

The INCB / UN drugs report 2009: Lots of interesting things

The new International Narcotics Control Board 2008 review world report is linked right here for you. Lots of interesting things inside, starting with the front cover that says:

Not to be published or broadcast before
Thursday, 19 February 2009, at 1100 hours (CET)

So how did IncaKolaNews get its grubby hands on a copy of the full 150 page report half a day before the rest of the world? Fun game this interwebnetworldwide thingy, isn't it?

Anyway, no surprises to find out that Colombia is still the biggest cocaine manufacturer in the world, but you might be surpised to find out that despite the six point seven billion dollars the USA has wasted on Plan Colombia since its inception, the growth in coca harvesting is by far the greatest in Colombia (55%), with Peru (29%) and Bolivia (16%), quite frankly, a couple of dowdy laggards. Amazing to hear the media portray Bolivia as the drugs scourge and Colombia as the great drugs freedom fighters of the 21st century, isn't it?

Here are the charts, with this one shows total area of cultivation, and that big wodge of Colombia translates as a rather large 99,000 hectares.

This one shows the growth in production between 2007 and 2008. Colombia at 27% sure has a decent growth industry on its hands, no? I mean, Peru and Bolivia's country GDPs grew faster than its cocaine industry in 2008 (both 5%)....those narcos need to get busier down there cos they're being put to shame by Land of Uribe, or even by their own governments!

Anyway, have a good read of the 2009 INCB report by downloading it here and be 12 hours ahead of the rest of the world. This was an IKN exclusive report, brought to you by spending too much time online.

Lime Slime's Brazil: Skinheads and Celsos

Our magnificent Brazil guest blogger Lime Slime is back with another tale from over that way. You should be used to him by now, so zero blabber from me. Take it away, Lime Slime:

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Here in Brazil, apart from the government trying to mitigate the impact of the crisis (and yes it will be bad folks because Lula never reigned in government spending during the commodity boom, which means it has almost zero room to take an even more pro-cyclical fiscal stance), the country has been shocked, awed and dismayed by the story of Paula Oliveira, 26, a young Brazilian in Zurich who showed up at a police station the other week claiming she was assaulted by three Nazi skinheads who carved the initials of a far-right political party into her legs and stomach.

The assault, she said, caused her to lose two twin babies as she was several months pregnant. The report caused an outcry in Brazil. People wrote long, angry comments on newspaper web sites, calling the Swiss racist pigs and, by extension, loudly proclaiming Brazil a place of racial harmony and bliss. Brazil's mercurial foreign minister, Celso Amorim, who has an anti-first world chip on his shoulder and a poor understanding of trade policy, personally "intervened" in the case to demand a full investigation. The Swiss can't confuse Brazilians with Turks, was the refrain.

But now it comes out that it was all a ruse. The cops said the story was fabricated, and a simple glance at the pictures shows that the letters were carved too precisely to be real. Now, the shipping giant Maersk is threatening to fire her in a case that resembles the McCain volunteer who falsely claimed she was beat up by Obama supporters and carved into her own cheek to prove it.

So, the question now is: will Brazilians retract all the vitriol they hurled at the Swiss? And what about old Celso? Has this thrown a wrench into his outdated first world vs. third world ideology? Brazil is a big boy now, and can't always play the victim anymore, Celso.

Berlusconi doesn't just offend IKN, by the way...---

By Antonio Berni (Argentine artist, 1905-1981)

......his words have now caused a diplomatic spat.

Argentina's chancellory has today summoned the Italian ambassador to express its "profound concern and ill-feeling" (precise Spanish "profunda preocupación y malestar") about the "joke" (a word that can be used only in the loosest possible terms) cracked by the Italian PM Silvio Berlusconi featured in this post found just down the page. It's so crass that it's not being repeated here.

Hey, I got an GREAT idea! Anyone know a few pathetic, offensive, racist Italian jokes that will offend even a quarter the amount that Silvio offended Argentina today? Which reminds me, thanks for the "Oh I'm so terribly offended by Silvio's weiner" mails this morning.

Related Post:
Silvio Berlusconi, freemasonary, death flights and Argentina's Dirty War

Trading Post (singing edition)


Doug Belanger sings the Beatles: "Will you still need me, will you still feed me, when I'm sixty-four?". GRZ down 10% at U$0.64.

Nadagold sings Jungle Book: "I reached the top and had to stop and that's what's a-botherin' me". NG down 3.3% at U$3.54.

Gold Hawk sings Gloria Gaynor: "Oh no not I...I will survive!". CGK.v UNCH at 3c this morning but positive funding news last night and $2m in working cap tucked away in its coffers.

Great Panther Resources sings Merle Travis: "You load sixteen tons, and what do you get? Another day older and deeper in debt". GPR.to Down 4.2% at $0.45.

Where's Waldo? Allen Stanford World Edition


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Related Posts

Full IKN Stanford coverage found here

Silvio Berlusconi is an offensive turd

Berlusconi: Now you know why he owns a Ferrari

Berlusconi is one of the few people on this planet I'd happily punch in the mouth to teach a few lessons in manners. There's little point trying to converse or debate with this so-called Prime Minister and representative of the Italian people.

Forget all the "tanned" jokes aimed at Obama, because his level of depravity goes much deeper. Silvio's idea of a joke this week is to talk about the Argentine Death Flights. By way of a quick outline, during the 1970's 'dirty war' when tens of thousands of people were murdered by the state one of the ways in which dissidents both alive (usually drugged) and dead were disposed of was to fly military planes over the Rio de la Plata and dump the bodies out the back. These people are not called the disappeared for nothing, you know.

So, Berlusconi's words this week? Talking specifically about the Dirty War and the body dumping he said, "The days were beautiful (back then), it made them descend from the skies", an ironic use of "them" to refer to angels, it seems, all delivered with that smarmy grin of his.

This is his idea of a joke? For crying out loud, this man should come over to this side of the Atlantic, stand up in front of all the families torn apart by the fascist dictatorship of the period and try telling that cracker. Have a wild guess about the reception he'd get.

Silvio Berlusconi: Prize Shit.

UPDATE: For those tuning in from Facebook in Italy and wringing their hands in mock horror, here's what Argentina thinks of your pathetic PM


Related Post:
Silvio Berlusconi, freemasonary, death flights and Argentina's Dirty War

Ventana Gold (VEN.to) and the blueprint of a successful young miner

As mentioned yesterday, here's that post on Ventana Gold (VEN.to).

The recent move in VEN.to has been fast and strong, coming on the back of two or three interesting PRs that have added to its project area in Colombia, returned excellent drill results and added financing on good terms for current shareholders. Here's the chart I put together yesterday with annotations. Note that the price line goes off the chart a bit to the right as I've added this morning's price move to yesterday's chart.

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So now compare what you see above to the theoretical, blueprint, not-gospel-but-right-idea chart below. This theoretical (see, I've said it again...that because there are no hard and fast rules here) gives an outline of what a successful miner's price chart often looks like over a five year period, as it moves from junior explorer to producer (and the Y-axis numbers are not representative, either...just an example):

Click to enlarge

You have an initial quiet period. Then comes a big move up when the market hears that "it's a live one" and the company has found itself a nice, prospective project. However at some point the initial enthusiasm wears off. Maybe due to a disappointing PR. Maybe because the company raises a ton of capital and dilutes too much. Maybe macro market conditions turn against it. There are dozens of possibilities but the result is the same, namely that the price goes down.

Then at some point in the life of this successful mining company a decision is made to move forward on the project. Financing is arranged and the whole thing starts to become a reality. This is often the point when long-term value seekers will take a position and hold it. As we move towards our theoretical year five, the mining project becomes a real mine and production starts. The share price increases along the way. The mine becomes a reality and the company matures into a producer. And they all lived happily ever after.

Now this is the most general of roadmaps and there are myriad alternatives, of course. Just as one example, it doesn't take into account any M&A activity. After all, a big miner could snap up our theoretical small miner at any point on this curve. However, Ventana Gold (VEN.to) is displaying all the hallmarks of that first "discovery period" share price jump right now; just don't ask me exactly where it is on the curve! Yesterday might have been the top, or there might be another dollar to add yet. I honestly don't know. Today's adjustment kinda points to a top, but the uptrend clearly isn't broken yet and there hasn't been any material news to change things fundamentally. Or in other words, DYODD, dude. Disclosure: I reco'd it at $0.67 but didn't buy myself (because I'm a pathetic whuss) and currently do not own.

Musical chairs, twobreakfasts style

As his President enters the room, Luis Valdivieso
shields his eyes from the glare of his smile

Remember about a month ago when Peru's FinMin Luis Miguel Valdiveso suddenly and unexpectedly resigned? Remember how his predecessor Luis "luckiest economist in LatAm" Carranza stepped up to take his place? Remember how, in the hasty and brief press conference Valdivieso said he'd been offered an alternative job by President Twobreakfasts?

Well yesterday the episode cleared itself up and Valdivieso was named as Peru's new ambassador of the United States of America, no less. It's all pretty logical on the superficial level, of course. Luismi was an IMF flunkey for years and knows the protocol side of the US backwards. He's also replacing the current Peruvian ambassador, Felipe Ortiz de Zevallos, who strangely and coincidentally handed in his resignation on January 21st, the day after Valdivieso resigned.

But it does shed a little light on the way Twobreakfasts is thinking (if the term is apt) on the Peruvian economy. He clearly wanted Carranza back, as the guy has a higher profile than Valdivieso and is (due to his incredibly lucky timing) credited as being a good hands-on economy manager. In fact he just continued the autopilot that came from the real architect of the Peruvian economy reforms, PPK, and did nothing much....the 'ain't broke don't fix it' rule. But style is far more important than substance in The World According To Twobreakfasts and Carranza's arrival has been an APRA spindoctors dream.

But once again, IKN wonders why Carranza came back and how Twobreakfasts got him to agree. When Carranza first resigned his post, the reason was that he wasn't making enough money as FinMin and wanted to get a nice cushy, highly paid gig in some private consultancy. Yeah, truly, it was said out loud right here by then PM Del Castillo and reported by your diligent IKN. It's kind of intriguing to think about all the recent corruption scandals in this awful Peruvian APRA government and then think that Carranza suddenly finds the FinMin job attractive once again, is it not?

The new Oxfam report on mining in Central America


Via the excellent Tim's El Salvador Blog, word reaches IKN that Oxfam has published a new report entitled "Metals, mining, and sustainable development in Central America" (get your copy of the report by clicking that title).

Now for sure, there are plenty involved in the mining industry that will read that first paragraph and roll their eyes while thinking "oh, gawd, another bunch of treehuggers that want to ban mining", but those eye-rollers would be wrong. Yes, the report is critical. Yes it does clearly point out that miners often exaggerate the potential benefits of a project to the local and national community and downplay the negatives that are then later experienced by those living in the area. But no, this isn't one of those "ban the dirty, horrible smelly miners" hit pieces.

What it does do is examine the patchy track record of mining companies over the last decades and say "look guys, you can't treat people like this any more". Here's the final paragraph of the conclusion to give you an idea:

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Given the high stakes involved, local communities must play a pivotal role in project and policy decision-making. This should start with universal support for communities’ right to free, prior, and informed consent. To support that consent process, host governments and mining companies should create a space in the public discourse where stakeholders’ interests can be respected and reconciled. This is especially true in Guatemala, Honduras, and El Salvador, where political and social factors may limit the role of certain groups, such as indigenous peoples, in the policy-making process.
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I think that's fair enough, and the enlightened mining companies of this world have now been operating responsible practices like these and more (and variations thereof) for plenty of years. With its report Oxfam is critical but constructive, laying out both sides, showing what hasn't been done right in Central America and saying how the industry could and, in its opinion, should move forward.

This is a useful report that gives the mining industry the other view without resorting to hyperbole and is highly recommended. Here's the link to the 40 page PDF report again, so there's no excuse. Wiser mineheads will read it.

Chart of the day is.......

....sugar, March09 contract.

Updating the series, as your humble correspondent still has that half position in CZZ. Cosan has faded from the $3.70-what-seems-like-a-kind-of-equilibrium point and closed $3.43 during the general broad market malaise yesterday. No sweating here, as the position was taken at $2.84 back in December. The pressure is off if you buy right, y'see.

Anyway enough of my horntootin', the chart still has sugar on the uptrend and so nothing much to fret...would like to see $13.50 in the next week or so, though. Vamos a verrrrrrrrr........

2/17/09

Alex Dalmady's blog now back up and working

Another Alex

Alex Dalmady has got his blog back up and running after yesterday's glitchy moment, which is wholly good news. Here's the link, so go now.

Meanwhile, a thought about James Donaldson, who got an airing with his rather emotional but also cherrypickingly well-informed rebuttal post of yesterday right here on this link. When I saw "James" come back again and post exactly the same comment on another IKN Stanford post I thought it was a little strange, so using sitemeter I tracked his ISP, and lo and behold he was writing from Memphis, Tennessee. I read today that the offices where Stanford's CFO James Davis worked (and that were raided today by the SEC) are also in Memphis. Also, I checked and filtered and crossed-filed and did all sorts on Google for about half an hour but I couldn't pin a James Donaldson with any connection (and I'm usually quite good at the Googling thing, too). Now I know that the home of Elvis music is a big town, but I can't help wondering. Can't help thinking about the coincidence of the "JD" initials, as well....

Finally, check out the latest at Devil's Excrement, as it shows just how mercenary the Stanford deposit collecting machine really was in Venezuela and gives one pause for thought. According to MO, it's the middle class sector that's going to be hit hardest, not some ultra-rich that might lose 10% of their net worth. The anger will come, unfortunately.

Click here for all IKN posts on Stanford (the series begins February 10th)


Trading Post (caught dat pesky wabbit edition)


Dynasty Metals (DMM.to) up 10.4% at $4.97. I took a few profits on a pre-programmed sale at $5 this morning. I didn't sell many, just a few in my normal "we're in a bear market" prudent portfolio management that you might be used to by now if you read on a regular basis (hope you do). Good to see the marekt waking up and smell the coffee about DMM.to. Volume average to good. The NOBS report is still available on DMM.to. Also, the report on my top pick for 2009, TRY.to is available, too (plug plug).

Ventana Gold (VEN.to) up 19% at $1.25 and doing very well. I'm glad to say that at least one regular reader jumped on in the 60s when I mused that it was going higher. I'll be writing a longer post on VEN.to later today...perhaps tomorrow morning.

Gold Reserve (GRZ) down 24% at U$0.78. Look I said it was pretty obvious that it would fold in on itself in pyrrhic style when the market woke up. Well today the market woke up. I got out at the right time. Meanwhile "that other stock" that neighbours GRZ in KM88 is up on idiotic speculation. A fool and his money..........

Fortuna Silver (FVI.v) down 5.4% at $1.04 after hitting $1.19 this morning. Don't know why? Find out here cos I nailed that trade. DYODD, dude.

Minera Andes (MAI.to) up 53% at $0.75 and having a special day. I posted on it this morning and my cap is still doffed. McEwen 1, Hochschild 0.

Stanford: A commenter questions its analysts and institutional coverage

A commenter has just left a longish note on one of the IKN posts regarding Stanford. Usually I reject anonymous comments but let's make an exception this time as the writer has some interesting points. I'm also devoting this post to his/her words. Here's the comment below and following that you can find a paste of the companies covered by the Stanford analysts. Take a look and make your own informed decision.

Just as a personal extra, I warn all again to keep well clear of the Colombian Stock Exchange, as Stanford was the fourth largest player by volumes traded there in 2008.

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The Comment Recently Received by an Unknown Reader

Now that the SEC has filed charges, the next question people will want answered is where did all of the money go. There's been some investigation into Stanford's role in penny stock investing, but I haven't seen anyone take a look at the companies that their "analysts" were covering.

http://www.stanfordgroup.com/institutional/coverage.aspx

A quick glance at some of the companies listed on their website reveal a large number of microcap stocks who've exhibited pump and dump behavior include spam campaigns around the time that Stanford initiated coverage.

If you take a look at the background of some of their "analysts" it also raises questions about the character of their employees. Their media analyst Frederick Moran for example began his career at Drexel Burnam (a known chop shop), was previous accused of sharing inside information with his father while working as an analyst at Saloman brothers and participated personally in a failed microcap company (VDC Communications) that was owned by his father and his brother Clay (who also happens to work at Stanford Research). A closer look at some of the other analysts will raise similar concerns as well as even more questionable buy ratings on companies that most financial savvy investors would know to steer clear of.

If Stanford was using proceeds from the CDs to manipulate penny stocks, then this could end up being an important piece of the puzzle. It would also go a long way towards explaining how they could have given such poor investment advice on what appear to be obvious scams.

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COVERAGE

Coverage as of September 10, 2008

Sectors:

Clean Technology


Clean Technology


  • Calgon Carbon Corp.
  • Comverge, Inc
  • Covanta Holding Corp.
  • Emcore Corporation
  • Energy Conversion Devices, Inc.
  • EnerNOC, Inc
  • Evergreen Solar
  • First Solar
  • U.S. Geothermal Inc.
  • Itron Inc.
  • Ormat Technologies Inc.
  • SunPower Corporation
  • Synthesis Energy Systems

Water


  • American Water Works
  • Aqua America, Inc.
  • BioteQ Environmental

Energy


  • American Oil & Gas
  • Anadarko Petroleum Corporation
  • Apache Corporation
  • Arena Resources, Inc.
  • BG Group, Plc.
  • Callon Petroleum Co.
  • Cameron, Inc.
  • Chicago Bridge & Iron Co.
  • Denbury Resources, Inc.
  • Encore Acquisition Company
  • Encore Energy Partners
  • ENSCO International, Inc.
  • Fluor Corp.
  • FMC Technologies, Inc.
  • FX Energy
  • Genesis Energy, L.P.
  • Golar LNG Ltd.
  • Helix Energy Solutions
  • Mariner Energy
  • McMoRan Exploration Co.
  • National Oilwell Varco, Inc.
  • Noble Corporation
  • Oceaneering International, Inc.
  • Pioneer Natural Resources
  • Range Resources Corporation
  • St. Mary Land & Exploration
  • Toreador Resources Corp.
  • Transocean Inc.
  • Ultra Petroleum Corp.
  • Willbros Group Inc.
  • XTO Energy

Health Care


Biotechnology

  • Amylin Pharmaceuticals, Inc.
  • ArQule, Inc.
  • Cougar Biotechnology Inc.
  • Cubist Pharmaceuticals
  • Elan Corp.
  • Exelixis, Inc.
  • Genzyme Corp.
  • Human Genome Sciences
  • ImClone Systems, Inc.
  • Maxygen Inc.
  • Medivation
  • Momenta Pharmaceuticals, Inc.
  • Myriad Genetics
  • Neurocrine Biosciences, Inc.
  • OSI Pharmaceuticals Inc.
  • Sepracor, Inc.
  • Telik, Inc.
  • Tercica, Inc.
  • Theravance, Inc.
  • United Therapeutics Corp.
  • Viro Pharma Inc.
  • ZymoGenetics

Health Care Services / Facilities

  • Alliance Imaging Inc.
  • Apria Healthcare Group
  • Community Health Systems
  • Da Vita, Inc.
  • Dialysis Corporation of America
  • Fresenius Medical Care AG & Co.
  • Health Management Associates
  • HealthSouth Corporation
  • LifePoint Hospitals
  • Lincare Holding, Inc.
  • Psychiatric Solutions Inc.
  • RadNet, Inc.
  • Tenet Healthcare Corporation
  • Universal Health Services

Medical Technology

  • Abbott Laboratories
  • Atricure Inc.
  • BioMimetic Therapeutics Inc.
  • Boston Scientific Corporation
  • Cytori Therapeutics, Inc.
  • Edwards Lifesciences Corp.
  • Johnson & Johnson
  • Medtronic, Inc.
  • Micrus Endovascular Corp.
  • NeuroMetrix Inc.
  • Northstar Neuroscience Inc.
  • St. Jude Medical, Inc.
  • Volcano Corporation

Technology / Media / Telecom


Enterprise Software

  • BMC Software
  • CA, Inc.
  • Citrix Systems
  • Guidance Software
  • McAfee, Inc.
  • Microsoft Corporation
  • Pegasystems
  • Red Hat
  • Symantec Corp.
  • Wind River Systems

Homeland Security / Defense

  • Aero Vironment, Inc.
  • American Science & Engineering
  • Analogic Corporation
  • Ceradyne Inc.
  • Force Protection
  • iRobot
  • OSI Systems, Inc.

Identity Solutions

  • Cogent Systems
  • Digimarc
  • Intermec, Inc.
  • LaserCard
  • L-1 Identity Solutions
  • Zebra Technologies Corp.

Infrastructure Software

  • OPNET Technologies, Inc.

Internet Software & Services

  • Akamai Technologies, Inc.
  • Art Technology Group
  • Digital River, Inc.
  • Equinix, Inc.
  • Internap Network Services
  • J2 Global Communications, Inc.
  • Premiere Global Services, Inc.
  • SAVVIS, Inc.
  • Switch and Data Facilities
  • VeriSign

Semiconductors

  • Techwell, Inc.
  • Trident Microsystems Inc.

Media

  • CBS Corporation
  • Clear Channel Outdoor Holdings, Inc.
  • Cox Radio, Inc.
  • Cumulus Media, Inc.
  • Emmis Communications Corp.
  • Entercom Communications Corp.
  • Lamar Advertising Company
  • Napster, Inc.
  • Priceline.com Inc.
  • Radio One, Inc.
  • Regent Communications, Inc.
  • Salem Communications
  • Sirius Satellite Radio
  • Time Warner Inc.
  • TiVo Inc.
  • Viacom B

Internet Media

  • Google, Inc.
  • Infospace, Inc.
  • Local.com
  • Marchex, Inc.
  • SourceForge, Inc.
  • The Knot, Inc.
  • ValueClick, Inc.
  • Yahoo!, Inc.

Telecom Services

  • Airspan Networks, Inc.
  • CenturyTel, Inc.
  • Clearwire Corp.
  • Consolidated Communications
  • Embarq Corp.
  • Frontier Communications
  • Iowa Telecomm Services, Inc.
  • Leap Wireless International, Inc.
  • MetroPCS Communications, Inc.
  • NII Holdings, Inc.
  • Sprint Nextel Corp.
  • Virgin Mobile USA
  • Windstream Corp.

Communications — Towers

  • American Tower Corp.
  • Crown Castle international Corp.
  • SBA Communications Corp.

Communication — Telecom

  • IDT Corp.
  • Vonage Holdings Corp.

It's just not cricket! Allan Stanford, Stanford International Bank and the whole rotten empire is toast.

You're out, Allen

The ECB (guys in blazers that run cricket) has just broken off talks with Cur Allen Stanford over a new sponsorship deal. Apparently it just is not the right thing to do business with cads and bounders.

Felix Salmon has done a nice overview of the SEC complaint with a list of salient points. He calls it "quite astonishing" and after reading it through carefully your humble correspondent has to agree. Go take a look a Salmon's post and while you're there give him the kudos he deserves in the comment boxes. He was the only high traffic blogger with the balls to run with this, he chided MSM all week about being so wishy-washy and he got the story out there and noticed by the larger world. While you're reading Salmon, read the full SEC complaint which you can download right here.

Duck Tales, the excellent report that started all this ball rolling, can be found right here, so go download it now and read a piece of financial history. The SEC moves today would not have happened, repeat would NOT have happened without the initial momentum caused by this brave and insightful report. Alex Dalmady is the unsung (so far) hero of the hour. May his star rise in the firmament.

The Devil's Excrement deserves special mention, as blog owner MO made the Duck Tales report available and wrote an impressive post that allowed Dalmady's note to finally catch the attention of the wider world.

The power of quality econoblogging has been definitively vindicated.

Click here for all IKN posts on Stanford (the series begins February 10th)