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8/24/11

Janice Shell of Streetsweeper: "I don't know a great deal about mining"

Here's a mail exchange that happened last week between your author and Janice Shell of Street Sweeper, co-author on yesterday's hit-piece about Gold Resource Corp (GORO) that has so far pocketed over $100,000 for the short-selling snakes in the grass at that morally defunct house of reprobates. You'll note

1) She thinks that just because i launch into junior mining stocks and shine a bit of light on the shadier practices in this sector I'm automatically the shorty's bosom buddy pally pal friend. Wrong, I'm the friend of truth, not some back-the-back moneymaking scheme run by asshole shorts who manipulate the market just as much as the bullshitting junior miner longs of this world.

2) She's happy that I pointed out a few home truths about GORO in this recent post, but "wished I'd said more". In other words she's already looking for unsubstantiated dirt. Sorry lady, it doesn't work like that, I stick to the facts (however much they might annoy longs of the stocks in question) and leave the bullshit lies for ulterior motives to sites like yours. 

3) I freely offer up opinion on her questionscall the rabid longs in GORO 'goldbug mouthbreathers' because that's what many of them are in my opinion, one that's backed up by several inane mail exchanges already (so don't bother guys and save your tinfoil rants for somebody else). 

4) She freely admits, without any sort of prompting, that she doesn't know much about mining. However that didn't stop her from writing a detailed hit piece on a mining company that her company had previously and quietly sold short. 

5) She has no qualms about putting words into my mouth, or changing previous statements she made to me (about a previous conversation on POTG.pk, a stock a willingly and loudly called a scam bacause it is a full-blooded pump'n'dump scam, period). When corrected, she just ploughs on trying to dig dirt that isn't there.


Final point before you read the mail exchange below. I've told a couple of high-up officers at GORO (names withheld) that I don't think GORO is a scam, I just think it's overvalued for what it is. I then wished them luck, told them to go out there and prove me wrong and that was that. We continue after the mail exchange, which is pasted in full, no typo corrections, no grammar polishing and nothing at all left out.

Janice Shell to me
show details Aug 16 (7 days ago)

Otto--

StreetSweeper is looking at GORO (but please don't tell anyone).  I've read what you've had to say about it, but wish you'd said more.  What do you think of it?  I agree that for now, they're a silver miner, not a gold miner.  What are the chances of that changing?

And what, of course, about Hochschild?  I gather from their most recent annual report that when they invest in a company as heavily as they did in GORO, they intend eventually either to take control, or divest entirely.  They haven't bought any stock since June 2010, which suggests they've decided on the latter.  But how would they get rid of that much stock, and to whom could they sell?  Have you heard anything?

I'd love to hear about anything else you might know.
janice

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otto rock to Janice
show details Aug 17 (7 days ago)

I think there's two main issues with GORO

1) No drilling program so far means that there's legitimate doubt as to what they have underground.

2) It's overvalued for what it is. I've run numbers and in an optimum situation (i.e. they find the mineral they say there is down there and keep on finding it) with Ag & Au at current prices, GORO is good for a 50c EPS. From that I'm good with a $18 share price, $20 tops. (ABX sells at 9X PE, why pay more for a pissant 450tpd miner?)

HOC.L is an extremely difficult company to read policy-wise. Difficult like Glencore is difficult. It's worthwhile to consider the long term history of HOC the company, because they made their company by buying prospective looking vein properties in Peru (well, first tin in Bolivia, but that's REALLY going back) and drifting down with no drilling done until they run out of Ag. It fits their history to invest in this minimally drilling GORO thing. But try to 2nd-guess what goes on at HOC BoD level and you'll spend days and weeks getting nowhere. Tough read, that company.

However I think HOC is now trapped in. They can't sell wholesale (to who?), they can't start selling on the open mkt cos it'd rank the stock in minutes. GORO is forced to defend its high share price and so far it's shown it can be done quite successfully. Having a bunch of mouthbreather goldbugs as your core support helps a lot too, of course. :-)
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Janice Shell to me
show details Aug 17 (7 days ago)

Thanks very much.  It's interesting that HOC doesn't thing drilling is worth the trouble, either.  GORO's attitude seems pretty much to be that they haven't done it simply because they don't feel like doing it, which is odd.  If they got round to it, presumably their financials would be more impressive to potential investors, because they could book their proven and probable reserves as assets.  But they don't care.  Over the years, they've said that to do a feasibility study would cost them about a million dollars.  Compared to what they've spent on the El Aguila project alone, that's a drop in the bucket.  So why not?  Recently they've been saying in conference calls--but NOT in their SEC filings--that they intend to do one this year.  I doubt that'll happen.  If they were serious about it, they'd have begun by now.

I don't know a great deal about mining, but I think if I were going to spend millions and millions on a mining project, I'd want to have a good idea what I could expect to find underground.  Even companies that have no intention of doing their own mining, but only want to sell their claims to the highest bidder, cough up for the NI 43-101s that will make it possible.  

What if GORO so expensive because the price of silver, not gold, is so high?  After all, they do have silver.  Much more silver, it seems, than gold.  So they benefit from the price of silver AND the enthusiasm of the goldbugs.  

You said in your blog that one of the Reids was posting at Yahoo.  Which one, and what's his alias?

Thanks again...

janice
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otto rock to Janice
show details Aug 18 (6 days ago)

No, I didn't say in my blog that one of the Reids was posting at Yahoo, if i were you i'd read what I wrote again. And while we're on the subject, I remember a while back (re POTG) that you made a comment about me being such-and-such poster on such-and such board. That's not true either, because i don't post on any bullboard anywhere and rarely even visit the things.

All in all it seems to me that you're a little too quick in jumping to conclusions. That'd likely be true for mining companies especially when you say that "I don't know a great deal about mining".
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Janice Shell to me
show details Aug 18 (6 days ago)

Sorry.  When you said "managerial team" I thought you meant a Reid.  

Hey guys over at the Yahoo board, did you know that GORO management are regular readers of your posts? Hey, wouldn't it be interesting if you found out that one of the posters there was in fact part of the managerial team at GORO, too?

I was merely curious; I wouldn't write about anything I couldn't prove.  As for the IHub poster calling himself "Bruce," I asked if you were he simply because whoever he is, he seems knowledgeable about things Peruvian.  He found the Wuakakuy claim numbers, the names of the original claim holders, and a few more things.  And he offered up Luna's cellphone number.  He's obviously not a fan of POTG or Luna, and is a native English speaker.  He was a brand new poster.  So I think you can see the logic of my question.  

Did you know that now Luna wants to do a 10:1 forward split?  That would raise the outstanding to 4.5 billion shares.  He now seems to be trying to appeal to hard core penny plungers.  But he's kind of screwed things up with FINRA; it may not happen.

janice
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otto rock to Janice
show details Aug 18 (6 days ago)

No. What you wrote was, "The penny dropped:  you must be "Bruce" on IHub."

If that's your way of asking a question, I suggest a few remedial English language classes.
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Janice Shell to me
show details Aug 18 (6 days ago)

Again, I'm sorry.  Though I wouldn't be so offended.  But then people confuse me with others all the time.  

Whoever "Bruce" may be--and I do wonder--he had some interesting information.


IKN back. That's the point where I decided I was thoroughly pissed off with this Janice Shell character and didn't bother to reply. Finally, as pointed out by an industry professional and friend this morning, the brains behind The Street Sweeper, a certain Hunter Adams, has a resumé that looks like this.
 
Hunter Adams, a member of the expert advisory board for The Street Sweeper/American Fraud Fighters, understands stock manipulation firsthand.  Adams entered the securities industry 15 years ago with a focus on high-risk penny stocks.  He quickly became an expert at establishing shell corporations, executing reverse mergers and selling both equity and convertible debt in speculative small-cap companies.  His career ended in 2001, when government investigators accused him of manipulating worthless penny stocks.  He pled guilty to two conspiracy charges -- for securities fraud and money laundering -- and served time in prison for his crimes.  Years later, he pled guilty to racketeering charges, fully cooperated with the government and accepted full responsibility for his actions.  Today, he has embraced a life of reform and now hopes to help protect the public by exposing others who tread in the same murky waters he once swam in. To contact him directly, please send an email to hunter@thestreetsweeper.org.
 

My industry pal also said (and I quote), "Here’s my nomination for “Spin of the Year”. The ... bio serves as an excellent tutorial from short-promoting StreetSweeper.com for turning a thrice-convicted white collar criminal into the number two crusading do-gooder at the organization, now pledged to root out his former compatriots in stock fraud.... Now all they need to do is provide him with mask and cape, and he becomes the next American Super-Hero"

The only thing wrong with my pal's note is he doesn't click that Hunter Adams is the whole bankroll behind Street Sweeper. And let us not forget that:

* Important Disclosure: Prior to the publication of this article, TheStreetSweeper (through its members) has effected a “short sale” of 74,246 shares of GORO stock at an average price of $25.28 a share with the intent of profiting from decreases in the share price. TheStreetSweeper has also purchased 50 September 2011 $30 "put" options priced at $5.80 apiece, hedged by the sale of 50 September 2011 $25 "call" options priced at $1.15 apiece, as well. TheStreetSweeper may choose to make additional trades in GORO securities, potentially covering part or all of its short position in the stock, and will fully disclose the details of those transactions as they occur. 
Update: TheStreetSweeper covered 3,200 shares of GORO stock at a price of $23.23 a share on Aug. 23. Following that transaction, TheStreetSweeper continues to hold a short position of 71,046 shares of GORO stock at an average price of $25.28 a share.

Disclosure: no position of any sort in GORO (not short, not long) and it's going to stay that way.