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12/24/09

Merry Christmas, happy holidays to all

As the word 'holiday' also implies 'no work', this humble corner of cyberspace will be applying the true spirit. Next post will likely be Sunday and normal service* resumes Monday morning.

Wishing all readers the best for the festive season.

*whatever that means

12/23/09

Feliz Navidad from IKN and Trend&Value

A thousand thankyous to Trend&Value for introducing me to this beautiful, wonderful, sublime and deeply moving Christmas song/video by Robert Earl Keene. I hope you enjoy it, too.



Merry Christmas to you all. Especially Lucas.

Trading Post (not even a mouse edition)


Dollar drops, gold ups, miners relief rally. Anything else need to be said here?

Canplats (CPQ.v) up 54% at $4.85 and the star of Christmas week trading on 10X volumes. I LOL'd a lot at the Bloomie version of the news that had Newmont this, Newmont that...and...errr...oh yeah those Mexicoans might have had summink to do with it. Hey, you London Bloomie Dumbass hacko, does 56/44 mean anything to you?

MAG Silver (MVG)(MAG.to) up 4.4% at U$6.14. People starting to catch on, perhaps (though volumes not high)? Abysmal mgmt about to be pushed aside? Who's to tell......

Fronteer Development (FRG) up 6.4% at U$3.97 and my idea of a short term pop-up play as per The IKN Weekly issue 34 from last Sunday. For sure pity I didn't pick Canplats, but hey...winz a win, no?

Troy Resources (TRY.to) down 3.3% at $2.06. I know what I'm supposed to do, cos I read it in 'The Boy's Own Book of Bullshit Pumping, 1984'. I'm supposed to tell you something like "oh you liked it at $2.50...well you'll LOVE it at $2 (smiley icon, plenty of exclamation marks, 4 paras of pumpy guff follows)". This stock isn't for the hot money momo sheep, it's for people who truly understand underlying value and as such the type of people that don't need pumpjobs in their faces. DYODD.

Dia Bras (DIB.v) up 8.3% today at $0.195. Good.

Argentina exports up 1% YoY in November

For the first time this year, Argentine exports have posted a YoY monthly increase. Exports for November 2009 totalled U$4.934Bn, up from the U$4.894Bn posted for November 2008. Here's the overview chart of exports and imports for Argentina since January 2008.....


....and it's a similar shape to plenty of other regionals (Peru, Chile etc). Again, it goes to show that no matter what political or economic system you have in place, if your country relies on exports for growth you get screwed exactly the same way and then you come out of the hole at the same time.

Just don't tell Moody's, the IMF, dumbass LatAm biz reporters, dumbass op-ed writers etc etc etc

Dia Bras (DIB.v) and MAG Silver (MAG.to) (MVG)

A Flash update just went out to subscribers (message to 'TK'; your mailbox is full and bouncing things, dude) regarding Dia Bras (DIB.v) and MAG Silver (MAG.to)(MVG).

Chart of the day is....

......the increase of trade between China and Venezuela in the period 2003-2008.



These numbers come from the lips of Jorge Giordani, Venezuela's Minister of Planning and Development. Luckily the Wall Street Journal decided not to scare you, went its own way and reported the increase at three times greater, not the thirteen times as spoken by the Minister. Wouldn't it be nice if they employed someone in Venezuela that spoke a bit of Spanish, yeah?

Meanwhile, China and Venezuela have just signed a piece of paper or something that will raise oil exports from this year's 380,000bbl/d to 630,000bbl/d in 2010. But yes, of course, don't worry, nothing's changed, pax americana, we down here still need you up there. That make you feel better?

12/22/09

Canplats, Goldcorp, Fresnillo and Newmont: Let the games commence

Now here's an interesting press release. Just when you think the market has dropped off to sleep until the new year, war breaks out. Interesting that this should hit the wires just one day after Peñoles completes a big internal restructuring.

Now watching MAG Silver.


VANCOUVER, BRITISH COLUMBIA--(Marketwire - 12/22/09) - Canplats Resources Corporation (TSX-V:CPQ - News) ("Canplats" or the "Company") announces that it has received a binding proposal from Minera Penmont, S. de R.L. de C.V. ("Penmont") for the acquisition by Penmont of all of the outstanding common shares of Canplats by way of a plan of arrangement that is financially superior to the terms of the business combination agreement between Canplats and Goldcorp Inc. ("Goldcorp") originally announced November 16, 2009 (the "Goldcorp Agreement"). The Board of Directors of Canplats (the "Canplats Board") has determined, after receiving a recommendation to such effect from its Special Committee and the advice of the financial and legal advisors to the Company, that the proposed agreement with Penmont is a "superior proposal" for the purposes of the Goldcorp Agreement and has provided notice of such determination to Goldcorp. The consideration that would be received by Canplats shareholders if the Penmont proposal was implemented represents a premium of 84% to the 20-day volume weighted average trading price of the Canplats common shares on the TSX Venture Exchange prior to the announcement by Canplats that it entered into the Goldcorp Agreement and a premium of 38% to the implied value of the proposed Goldcorp transaction based on the closing price of the common shares of Goldcorp on the Toronto Stock Exchange on December 22, 2009.

Under the transaction proposed by Penmont, Canplats shareholders would receive, for each Canplats common share, C$4.20 in cash and shares of a new exploration company with a notional value of C$0.20. The new exploration company would hold C$10 million in cash and Canplats' Rodeo, El Rincon, Mecatona, Maijoma and El Alamo Properties. Except for its financially superior terms, and the fact that all (and not 90.1% as outlined in the Goldcorp Agreement) of the shares of the new exploration company would be distributed to Canplats' securityholders, the proposed agreement with Penmont is substantially similar to the Goldcorp Agreement, including with respect to the treatment of outstanding options and warrants to purchase common shares of the Company. The proposed agreement with Penmont includes a break fee, payable to Penmont in certain circumstances, of C$9.3 million, which is the same percentage of the value of the Penmont transaction as the break fee payable to Goldcorp under the Goldcorp Agreement.

Under the terms of the Goldcorp Agreement, Goldcorp has a period of five business days expiring on Thursday, December 31, 2009 (the "Response Period") to offer to amend the terms of that agreement.

If, within the Response Period, Goldcorp offers to amend the Goldcorp Agreement such that the Canplats Board determines that the proposed agreement with Penmont is no longer a superior proposal, Canplats will be required to enter into an amendment to the Goldcorp Agreement and implement the amended agreement. In that circumstance, no agreement will be entered into between Canplats and Penmont with respect to the transaction proposed by Penmont.

If, within the Response Period, Goldcorp does not offer to amend the Goldcorp Agreement, or if the proposed Penmont transaction continues to be superior to an amended transaction proposed by Goldcorp, Canplats intends to pay Goldcorp the agreed termination payment of C$7.2 million, terminate the Goldcorp Agreement and enter into an agreement with Penmont to complete a transaction on the terms proposed by it. In that event, the directors and officers of Canplats will enter into lock-up agreements with respect to the transaction with Penmont on substantially the same terms as the agreements entered into with Goldcorp pursuant to which, among other things, they will agree to vote their Canplats common shares, options and warrants in favour of the Penmont transaction at a meeting of securityholders of Canplats to be called to consider such transaction.

Canplats will issue further news releases providing additional information as developments warrant, including information with respect to any changes to the meeting of securityholders of Canplats currently scheduled for January 14, 2010.

Penmont, a company jointly owned by Fresnillo PLC ("Fresnillo") and Newmont USA Limited, a subsidiary of Newmont Mining Corporation ("Newmont"), owns the operating Herradura mine and the nearly complete Soledad & Dipolos project, both located in Sonora, Mexico. Fresnillo, the world's largest primary silver producer and Mexico's second largest gold producer, is listed on the London Stock Exchange under the symbol "FRES". Newmont is one of the world's largest gold producers with significant assets or operations in the United States, Australia, Peru, Indonesia, Ghana, Canada, New Zealand and Mexico. Its common shares are listed on the New York Stock Exchange under the symbol "NEM".

Michael Porter on Peru: The presentation

This is the presentation given on November 30th by Michael Porter that didn't go down at all well with Twobreakfasts because Porter went and told the truth.

Essential reading for LatAm econoheads and a deserver hat tip to Juan Sheput for bringing it to the blogosphere's attention.





x

Peru: Bye Bye Spongebob, Hello (Mecha) Meche


Note: in my haste earlier I wrote "Mecha" Araoz instead of her real handle, 'Meche'. Errare humanum est.

According to breaking reports,
Mercedes Araoz (one of the few good politicos hanging round Twobreakfasts these days) has just been named as Peru's new FinMin, replacing Luis Spongebob Carranza.

Spongebob will be remembered as Mr 6%....no, 5%...no, make that 4%....errr 3%, hold on 2%....aha 1% GDP growthman and architect of the worst hard landing economic slowdown in Peru's modern history. He'll now go back to his cushy and well paid bank job (though they never really stopped his bank salary I hear......but we can't mention that) after taking time off and hanging at the exclusive 'Asia' beach resort South of Lima for a month.

Meanwhile, Mercedes 'Meche' Araoz gets to play at numbers after working up through the ministerial system. A workaholic, a nice person and as it's not a sin let's point out that she's pretty, too.

Another lesson in macroeconomics for Miguel Centellas

This time from Brazil. As pointed out recently, international currency reserves cost money to hold and once they get to a certain level a government is much better off finding a decent use for the revenues received. The previous example was Bolivia, this time it's Brazil. The point being made is exactly the same, that social programs funded by these incomes are not expensive at all (as the dumbasses like to make out as they jump to ill-informed conclusions), but a cost-effective method of sharing the bonanza and promoting growth.

Dec. 22 (Bloomberg) -- Brazil should stop increasing international reserves as the local currency stabilizes and economic growth quickens, former central bank director Carlos Eduardo de Freitas said.

“It’s a totally logical moment for the central bank to stop buying reserves,” Freitas, who was part of the central bank’s monetary policy committee from 1999 to 2003, said in a telephone interview from....

"...“If they don’t stop buying reserves now they will be paying a high cost for no reason,” Freitas said yada yada continues here
There is one difference between Brazil and Bolivia on this subject, however. Brazil will get praise from the chattering classes for its sound macro policy, while Bolivia will get ignorant pseudos criticizing it once again.

Learning anything yet, CentellasFool?

Good news from Mexico

Arriving at your eyeballs, courtesy of The Mex Files (photo ripped from TMF, too):

"By a margin of 39 to 20, the Federal District Assembly approved a bill redefining “marriage” as the “free uniting of two PERSONS” earlier today. Jefe de goberierno, Marcello Ebrard still needs to physically sign the bill, and the text has to be published in the Gaceta before the new law takes effect… which takes about 45 days. Wedding planners might want to start work now for the mid-February rush.

Naturally, Felipe Calderón is already looking for some way to challenge the bill in the courts and Armando Martinez, the president of something called the College of Catholic Attorneys is whining about...."

CONTINUES HERE

Simon says.....

...I don't like Emerick (ERC.v) any more:

Emerick Resources Corp. (ERC)

As of December 21st, 2009
Filing Date Transaction Date Insider Name Ownership Type Securities Nature of transaction # or value acquired or disposed of Unit Price
Dec 21/09 Dec 17/09 Ridgway, Simon T.P. Direct Ownership Common Shares 10 - Disposition in the public market -88,000 $0.260
Dec 21/09 Dec 17/09 Ridgway, Simon T.P. Direct Ownership Common Shares 10 - Disposition in the public market -2,000 $0.255
Dec 21/09 Dec 17/09 Ridgway, Simon T.P. Direct Ownership Common Shares 10 - Disposition in the public market -19,000 $0.260
Dec 21/09 Dec 17/09 Ridgway, Simon T.P. Direct Ownership Common Shares 10 - Disposition in the public market -30,000 $0.270
Dec 21/09 Dec 17/09 Ridgway, Simon T.P. Direct Ownership Common Shares 10 - Disposition in the public market -45,000 $0.270
Dec 21/09 Dec 17/09 Ridgway, Simon T.P. Direct Ownership Common Shares 10 - Disposition in the public market -9,000 $0.275
Dec 21/09 Dec 17/09 Ridgway, Simon T.P. Direct Ownership Common Shares 10 - Disposition in the public market -50,000 $0.300
Dec 21/09 Dec 17/09 Ridgway, Simon T.P. Direct Ownership Common Shares 54 - Exercise of warrants 243,750 $0.200
Dec 21/09 Dec 17/09 Ridgway, Simon T.P. Direct Ownership Warrants 54 - Exercise of warrants -243,750


It's not surprising after it's total bomb in the Yukon drilling program in November...and the way the $300k financing round was cancelled last week. Funny how this one got pumped by the Casey crew a couple of weeks back, innit? Favours for favours and all that....ho hum.....

Total OT: Focus Ventures (FCV.v) finished weak yesterday, didn't it Louis?

UPDATE:
For the doubtermailers, ERC.v was mentioned by the Casey Investment Alert number 362 dated December 4th, only one of two stocks in the alert. And no, I'm not a subber (more value in spending on ice-cream).

Have yourself a vampire squiddy lil Christmas......

From The UK Guardian right here. Nice 'toon.

chart of the day is....

....pretty wonky, as it's the three Bolivian monetary aggregates as a proportion to country international currency reserves, 2006 to date.

Just to show it works for all three of 'em, not just M2 (though M2 is still the best gauge, I'd venture). By the way, the official set forex of the Bolivian Peso is 6.97 the buy, 7.07 the sell. When compared to M2 it's a good value currency.

By the way, if you don't understand the significance of this chart, don't bother opening your mouth and voicing an opinion on Bolivia's economy. Like ever, dude.

12/21/09

It's always around this time of year that something comes along and reminds me that......

...you gringos will buy anything. Here's this year's example, sent in by a reader BH:

"Our goal at Precious Earth is to make jewelry that is as beautiful on the inside as it is on the outside. We know that inner beauty is what it takes to sustain a relationship and that is exactly what Precious Earth jewelry is about. Each Precious Earth piece is created with the socially conscious consumer in mind. You will feel good knowing that your jewelry is crafted with recycled and renewed precious metals in an effort to help preserve the earth’s natural resources yada yada continues here

I LOL'd. By the way, anyone looking for a genuine Aztec ballpoint pen set, drop me a line. Discounts for bulk.

When wonks get cat scratch fever


This is fun for a slow day and beats watching gold drop.

A blog called "fire larry summers now" (there may be a subliminal message in that one somewhere) run by some economics undergrad gets trashed and spat on by Greg Mankiw and then soundly defended by one of my faves, Jonathan Schwarz at A Tiny Revolution.

Econobitchin', dude.

Trading Post (solstice edition)


Pediment Gold (PEZ.to) up 9.6% at $1.48 on good volumes. The triple-play news last Friday (including after the bell action) has popped the stock.

Animas Resources (ANI.v) down 14.3% at $0.60. Welcome to the world of stupid, where a single miss drilling cluster from an true exploration play miner gets investors reacting like the company is about to do an ATW Gold and going into headless chicken mode.

Colossus Minerals (CSI.to) down 6.7% at $5.44 and now there's a 10%+ gap between the PPS and the prices that CEO Ari sold his chunks for recently. There is a difference between an ANI and a CSI when drilling, y'know. The ANI's of this world are actually trying to discover something new whilst the CSI's just pretend they're discovering stuff. Reading a CSI news release is like listening to the sound of a fake orgasm and reading Nicholas CampbellSoup's views on the stock is like watching a porn flick...satisfying for others perhaps, but a pathetic substitute for the real thing. Back to ANI for a second and this morning's sell off smacks of a buying opportunity in Animas. It might be getting fed further by the tax loss selling this time of year.

ECU Silver (ECU.to) down a penny at 72c and just ten days to go before the massive half price GATA sale begins.

Fronteer Development (FRG) up 1.7% at U$3.66 and was up further at the open. FRG got hit for no apparent reason late Friday and looks cheap here. I own and I added a few traders this morning.



Madre de Dios, Peru: We're now allowed to worry, because......


...English language media now consider the story important.

The BBC (damned Eurocommies won't let a guy do a fair day's work, eh?) starts its report like this. Click thru for the rest

Peru's gold rush sparks fears of ecological disaster

The high price of gold has drawn thousands of miners to a region of south-east Peru, but deforestation and the high levels of mercury used in mining has led to fears of an imminent ecological disaster, as Dan Collyns reports.


It is only from the air that you can see the full extent of the destruction.

The forests seems almost endless until it is abruptly interrupted by the raw colours of sand and earth; rivers torn open and thousands of hectares denuded and pocked with dead, stagnant pools of water.

Alluvial gold mining in Peru's southern Amazon rainforest has spread, driven by the high price of gold, now more than $1,100 (£680) per ounce, or $36 a gram.

Close to 200 sq kms (77 sq miles) of jungle have been lost in the evocatively named Madre de Dios (Mother of God) region.

"To know what we are losing, this area of Peru - the western Amazon - is the world's enclave of biological diversity," says biologist Ernesto Raez, who heads the Environmental Sustainability Centre in Lima's Cayetano Heredia University.



CONTINUES HERE

Ecometals (EC.v): What makes you think they're not the greatest of business partners, Otto?

Ohhh...just an inkling of mine, y'know....

Please find below an official registered letter dated December 19th 2009 sent to the stock markets of Toronto, Frankfurt, Sao Paolo and Quito by Tocantins, the JV partner of Ecometals (EC.v) in Brazil. No further comments from me necessary, as it's best to let those who know the EC.v intimately tell their story. First find the English translation (thank you to reader NK for the good translation job done there) and below the Portuguese language original.


Ecometals limited, registered in the Bermuda Islands, formed a JV with
Alto Tocantins Mineração Ltda e Tocantins Mineração S.A (ATL).

After various signed and unfulfilled agreements, lies, subterfuge and fraud on behalf of Ecometals Limited and despite reports sent to the Toronto, Berlin and Frankfurt stock exchanges informing them that the Serra Navio manganese property has been transferred to Ecometals Limited; The claim is false

The property contains in excess of 5 million tonnes of extracted and stockpiled manganese in the municipality of Serra do Navio Ap (located on the property of Alto Tocantins Mineração Ltda e Tocantins Mineração S/A) that does not effect and will not effect the transfer of manganese mineral (this property is proven in annual budgets, the federal revenue registry and income taxes of the company Tocantins Mineração S/A ).

The unfulfilled agreement and irresponsible attitude of the company and its CEO Fran Scola, has caused us innumerable damages and difficulties, including a 15 month delay in payment of employees resulting in innumerable worker actions, protests, judicial orders from suppliers and the federal revenue service, including judicial action on behalf of workers of Ecometals Limited in Brazil.

This flagrant attitude of Ecometals Limited has also resulted in non-payment of a single month's salary to Director Jorge Augusto Carvalho de Oliveira(ATL), since the formation of the JV. The director of Ecometals Limited in Brazil , Mr. Paulo Fernando Chedid Lisboa faces serious charges in federal court which are immobilizing all projects of Ecometals Limited throughout Brazil.

Tocantins Mineração S/A is a company with vast experience in the mining field with 50 years of active experience in the market and does not act by the corporate principles and norms of Ecometals Limited: as a result, the company has adopted the following provisions::

The company has removed the chairperson, Sr. Jean Roberto Houat, leaving ATL without representation in the administrative council of the JV

The JV contract has been retracted and mandated to court to proceed with the dissolution of the company for non-compliance with contractual clauses

Actions are being taken in Labour court for the payment in arrears of Director Mr..Jorge Augusto Carvalho de Oliveira

Interested parties can reach us at the following address to receive documentation related to the case.

Alto Tocantins Mineração Ltda
Tocantins Mineração S/a
Tel.55 3196-3281-5066
Santana – Amapá
19 de dezembro de 2009-



ECOMETALS LIMITED – (TSX.V: EC)

A Ecometals limited, com registro nas Ilhas Bermuda constituiu JV com a empresa Alto Tocantins Mineração Ltda e Tocantins Mineração S.A
Após várias tentativas de acordo assinados e não cumpridos, com mentiras, subterfúgios e trapaças por parte da empresa Ecometals Limited,e apesar dos relatórios encaminhados para as Bolsas de Valores,Toronto, Berlim e Frankfurt, dando ciência que e a propriedade do minério de manganês de Serra do Navio ter sido transferidas para Ecometals Limited; é mentirosa.
A propriedade de mais de cinco milhões de toneladas de minério de manganês extraídos e estocados no município de Serra do Navio Ap (propriedade das empresas Alto Tocantins Mineração Ltda e Tocantins Mineração S/A).,que não efetuou e nem vai efetuar a transferência do minério.de manganês.(propriedade comprovada em balanços anuais publicados, receita federal e imposto de renda da empresa Tocantins Mineração S/A )
O acordo não cumprido e em atitude irresponsável da empresa principalmente do CEO-Fran Scola, nos proporcionou inúmeros dissabores e prejuízos, como atrasos do pagamento de salários dos funcionários há 15 meses resultando em inúmeras ações trabalhistas, protestos, execuções judicial de fornecedores e da receita federal; inclusive com ações judiciais trabalhistas em nome da empresa Ecometals Limited, no Brasil.
Em atitude covarde a Ecometals Limited, também não realizou pagamento de salários (pró labore) do Diretor Jorge Augusto Carvalho de Oliveira(ATL), nem um mês sequer desde a constituição da JV.
O Diretor da Ecometals Limited no Brasil-Sr.Paulo Fernando Chedid Lisboa possui sérias implicações na justiça federal o que está inviabilizando todo o projeto da Ecometals Limited a nível Brasil.
O Tocantins Mineração S/A é uma empresa com vasta experiência no ramo de mineração com 50 anos de atuação no mercado e não tem como princípio e normas os procedimentos corporativos da Ecometals Limited ; por isso adotou as providencias abaixo:
- Retirou assento da Diretoria – Sr. Jean Roberto Houat., ficando a empresa ATL sem representante junto ao Conselho de Administração da JV.
Denunciou o contrato de constituição da JV,junto a Justiça para proceder a dissolução da sociedade, pelo não cumprimento de cláusulas contratuais,
Execução na Justiça do Trabalho para pagamento dos salários em atraso do Diretor Sr.Jorge Augusto Carvalho de Oliveira
Se do interesse enviem-nos endereço para despacho da documentação objeto da denuncia.

Alto Tocantins Mineração Ltda
Tocantins Mineração S/a
Tel.55 3196-3281-5066
Santana – Amapá
19 de dezembro de 2009-

Chart of the day is...

.....Peru's GDP for the whole decade.

(click to enlarge)
Just soes ya knowz. And while we're at it, here's how Peru's GDP compares to internal demand for the period.
A lost year and a hard landing. Proof if needed that 10% growth isn't sustainable. And they give these jokers investment grade? Hah!

UPDATE: After getting a mail to ask about this, here's a close-up view of GDP versus internal demand in the last two years. You can see the difference more easily this way.
Viva Free Trade Agreements, yeah?

12/20/09

The IKN Weekly, out now


IKN 34 has just been sent (a couple of hours later than its normal time) to subscribers. We have a NOBS report on Pediment Gold Corp (PEZ.to) that notes the recent newsflow from La Colorada, San Antonio and the year-end financial results posted last Friday, we have more talk of risk in Colombia, we have thoughts on copper that look set to develop in the next few weeks, we have a report of the recent meeting between this humble correspondent and the CEO of a very interesting junior mining company (and its VP Expl was there too). All for the dee lek tay shun of subbers. U$25 a month? Cheap!

Don Coxe Basic Points December 2009

Here

Or if you prefer, we embed. Thanks to reader 'A' for the headsup.

we heart XKCD

I waited a week before pasting this edition of XKCD here because I don't want to steal thunder (there are two newer strips on site now). But this is so very good.

click here for original page (bigger image too)

Spreading a little happiness on the Sunday before Christmas. Here's the link to the front page of XKCD, use it early and often.

How the third world works

Yves Smith over at Naked Capitalism fills us in.

After hearing passionate arguments from the Obama Administration, the Supreme Court acquiesced to the president’s fervent request and, in a one-line ruling, let stand a lower court decision that declared torture an ordinary, expected consequence of military detention, while introducing a shocking new precedent for all future courts to follow: anyone who is arbitrarily declared a “suspected enemy combatant” by the president or his designated minions is no longer a “person.” They will simply cease to exist as a legal entity. They will have no inherent rights, no human rights, no legal standing whatsoever — save whatever modicum of process the government arbitrarily deigns to grant them from time to time, with its ever-shifting tribunals and show trials.

Is this true? I'm amazed.

cash4gold...or gold4cash?

Lucas over at Trend&Value has posted a couple of very interesting charts that compare "money in the bank" as an investment to gold and to silver over the longer-term.

I'm not ripping the charts here, so to see them click this link and go over there yourself. A short but insightful post, nice one Lucas.