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10/15/11

Killing people is going out of fashion

This is by far the most interesting thing I've read today, an interview with Stephen Pinker and a review of his book,"The Better Angels of Our Nature: The Decline of Violence in History and its Causes" which argues convincingly, according to the reviewer and others mentioned at least, that modern times are the least violent ever for humanity.

It's linked here again, to make sure you go read it too. Fascinating stuff.

10/14/11

The Friday OT: Novalima; Machete

Novalima is a Peru ensemble making irresistible and infectious music by re-working traditional beats, rhythms and songs from Peru's coast. It's influenced by African slave music, creole traditions and old-time boleros and driven by the sound of the 'cajon' (a wooden box you sit on and play a little like the bongos). The two Novalima albums currently in your author's possession, namely 'Afro' and 'Coba Coba', are getting a lot of airtime Chez Otto due to the fact that they're wonderful.


This track is 'Machete', also featured on the soundtrack of the recent movie of the same name, but consider it just a sampler of what Novalima can do for the benefit of your ears and check out more from this link. Lyrics are minimal and the whole gig is about the music beat so fear ye not non-Spanish speaker, click play and enjoy.

UPDATE: A friend writes in to highlight his fave Novalima video, 'Coba Guarango'. As your author was debating between Machete and Coba Guarango before choosing, let's just go the whole hog stick it here as well....killer beat to this one...


....and you're bound to love them both.

It's a BiiWii giveaway

For those of you who don't know how good Gary BiiWii's subscription service, Notes From The Rabbit Hole (NFTRH) is, here's your chance to find out. Gary has decided to give away last weekend's edition (#156) for free and you can get yours just by clicking this link.

Find out more about the decision to offer this freebie here (plus the way to get to an example of his excellent midweek e-mail update service). 

Disclosure: I get nothing at all from Gary for reco'ing his newsletter. I'm happy to give him free publicity and tell you how good it is simply because it's so good. The end.

Whatever makes you think that the management of Great Panther Silver (GPR.to) (GPL) is a bunch of self-serving bullshitters, Otto?

Ohhhh, just a hunch of mine, dude.


Let's compare and contrast Great Panther Silver's (GPR.to) (GPL) confident outloook statement from its 2q11 MD&A....
"The addition of new production areas from the increased development in the first two quarters, together with better grade control are anticipated to lead to increased mine output and higher grades in the second half of 2011. The recent drop in ore grades at both operations is being addressed as the cost per ounce at both mines is sensitive to grade."

 ....to the note about grade and production for the third quarter of 2011 in the NR out last night, after the bell:

"...a significant drop in ore grades resulted in metal production being lower by 18%."

It's going to be interesting to note where that fictional cash cost number GPR.to spews to the market every quarter is pitched this time, isn't it? And all this at a time when CEO Archer was selling over a million dollars of his own stock into the market.
Yeah, really.

Acid warning

"To get back to the warning that I received. You may take it with however many grains of salt that you wish. That the brown acid that is circulating around us isn't too good. It is suggested that you stay away from that. Of course it's your own trip. So be my guest, but please be advised that there is a warning on that one, ok?"
Woodstock, 1969

Meanwhile, the price of sulphuric (or sulfuric if you prefer) acid has been rising pretty fast these last few months. Here's a neat chart out of the Scotia daily letter yesterday that has the story of H2SO4 and its price these last ten years.


Chart of the day is...

...gold (GLD) versus silver (SLV) versus miners (GDX) versus juniors (GDXJ) these last five days:


Fairly even performances, all told.

10/13/11

Bagholders of Great Panther (GPR.to) (GPL) Unite!

ONE....MILLION....DOLLARS!


dyodd, dude

Farewell, FT Tilt

The following was deposited in this humble scribe's mailbox today:

Goodbye from the FT Tilt Team

Dear Readers:

This isn't quite what we thought our next dispatch would consist of, but here it is: the FT has decided to close FT Tilt, effective immediately.

To our subscribers - Ranjan Roy will be getting in touch to ensure you get a full refund. Please look out for emails from him in the coming days. We're sorry if it takes a little while to process; we will be working to minimise any delays or inconvenience. If you have immediate questions, please email help@ft.com.
 

To all our readers - thank you for your interest in our journalism. That’s all for now, and for good. You can still email us (for now) on sishmael (at) fttilt.com, rroy (at) fttilt.com and pmurphy (at) fttilt.com. And if you want to let the team know how much you've enjoyed their work, you can find all their email addresses on our contact page

Sadly this doesn't come as much surprise and was even expected here at IKN, as witnessed in this June 28th post, "Paywalls still don't work, FT Tilt edition" which included this:
"...the evidence of how paywalls don't work on the internet is plain here because in a different set-up, 3300 paying subscribers would be a good moneyspinner, but for a company under the auspices of FT it's 1) small beer and 2) extremely unlikely to cover the costs of running a service with a bunch of professional journalists running the show.

Market it how they want, but putting me back on a free subscription for a limited period is an attempt to prop up a failing business model"

 There's no denying the quality of work done at FT Tilt and the decision to offer a service aimed at providing the English speaking world with better insight into the world's emerging market was a good one....but not to charge a fee for the gig. Sorry, but with very few exceptions the rule should be clear by now: THE INTERWEBZ DOES NOT WANT TO PAY FOR A NEWS SERVICE.

So farewell FT Tilt and applause for a good try. But you were always doomed to failure.

UPDATE: Felix Salmon's FT Tilt obituary, right here

Fundamental gold producing value play quiztime

Question: Name a producing gold miner that has;

  • a share price of 82c
  • a market cap of just $70m
  • a rapidly growing treasury and a working cap of $20.5m
  • has just returned a quarterly net profit of $5.5m (earnings posted last night)
  • that's a quarterly EPS net profit of 6c/share (yeah, that says quarterly)
  • if you care to do some simple math, has a forward P/E ratio of 3.5X
  • is ramping up production in this quarter
  • plenty of mine life and exploration potential at its flagship

???????

Answer: right here. 

dyodd

"...never been a better time to become an economic geologist..."

That's especially true if you nail a decent options award, plus the copious amounts of alcohol you are contractually obliged to drink, but anyway, reader 'JT' kindly sends in this link this morning, the contents of which are good enough to grace these humble pages below. Thanks JT.

Metal Shortages Alert from Leading Geologists: Inexorable Demand for Consumer Goods Places Strain On Supply of Metals


ScienceDaily (Oct. 12, 2011) — Geologists are warning of shortages and bottlenecks of some metals due to an insatiable demand for consumer products.
A meeting of leading geologists, reported in the journal Nature Geoscience, highlights the dangers in the inexorable surge in demand for metals.
Dr. Gawen Jenkin, of the Department of Geology, University of Leicester, is the lead convenor of the Fermor Meeting of the Geological Society of London which met to discuss this issue.
Dr Jenkin said: "Mobile phones contain copper, nickel, silver and zinc, aluminium, gold, lead, manganese, palladium, platinum and tin. More than a billion people will buy a mobile in a year -- so that's quite a lot of metal. And then there's the neodymium in your laptop, the iron in your car, the aluminium in that soft drinks can -- the list goes on...
"With ever-greater use of these metals, are we running out? That was one of the questions we addressed at our meeting. It is reassuring that there's no immediate danger of 'peak metal' as there's quite a lot in the ground, still -- but there will be shortages and bottlenecks of some metals like indium due to increased demand.
"That means that exploration for metal commodities is now a key skill. It's never been a better time to become an economic geologist, working with a mining company. It's one of the better-kept secrets of employment in a recession-hit world.
"And a key factor in turning young people away from the large mining companies -- their reputation for environmental unfriendliness -- is being turned around as they make ever-greater efforts to integrate with local communities for their mutual benefit."

Chart of the day is...

...the IKN Sentiment Indicator, from the front page of Canadian Insider:


Insider purchases are rising all right, though not yet to the +500% level we saw at the height of the late'08 crisis (as you can see on this historical version of the same indicator).

10/12/11

Now playing

Chez Rock:


It's good to share, the better things in life should be shared.

The mail your author sent to Roger McConchie, lawyer representing Kaare Foy, the Chairman of Great Panther Silver (GPR.to) (GPL)

Early in September your humble scribe received a mail from a certain Roger McConchie, a lawyer representing the Chairman of Great Panther Silver (GPR.to) (GPL), Kaare Foy. As the mail was plastered with things like "copyright" and "you can't reproduce it anywhere" and other such anally retentive guff I can't really post it up, much as I'd like to. Suffice to say that the mail received told of how I'd been awfully awfully unfair to Mr. Foy on these pages, demanded the removal of certain IKN posts and a grovelling retraction or two. 

So we can't show you the contents of Roger McConchie's mail...but we can show you my reply to him sent September 15th 2011 (they'd asked for a reply by the 16th, so naturally we complied). Here it is and strangely enough, since sending this mail we haven't heard a peep from Roger or Kaare for that matter, even though a reminder mail was sent to them from this desk at the end of the month. Enjoy.

Roger,

Just three things to mention at this point.

1) We wholly disagree with your false accusations and nothing is being changed on the blog.

2) As at August 21st 2011 we recommended Great Panther Silver (GPR.to) (GPL) as a buy on our subscription service with a target price of $4.50 set. We state clearly that the recommendation occurred long before your false accusations were made known. It wasn't at recent stock price lows, either. A copy of the report is available on request, but hey... feel free to alienate a long supporter of GPR.to and his client base by continuing with your baseless threats if you prefer.


3) Your client would greatly benefit from the advice offered in this segment of the Ronnie Johns show.


Linked here
 

As Mr. Johns is a fellow Australian, it may help to ram home the point that going all soft about (wholly incorrectly) perceived SIWOTI is hardly the way to move forward in this 21st century world.

Have a pleasant weekend, sir.

IKN back with a couple of notes. Firstly, for those not au fait with internet slang, SIWOTI stands for "something is wrong on the internet". Secondly, subscribers to The IKN Weekly can attest to the accuracy of point 2). Thirdly, Ronnie Johns rocks.

Minefinders (MFN) (MFL.to) 3q11 production numbers suck

And sadly, it was partly due to another operational snafu that we hadn't been told about before. Here are the charts for gold and silver production and, according to the AuEq number, production is a third down on the 2q11 figure overall.  Gold is slightly down, silver is nastily down.


Here's a link to the NR and you now have one hour from when this post was written (07:30am local time) to make a call on the stock.....don't say you weren't informed earlybird, though (bows gracefully)

Minefinders (MFN) (MFL.to): Snatching defeat from the jaws of victory since 2009.

disclosure: No position right now, have been playing this stock quite nicely this year, though.

Chart of the day is...

...copper, monthlies:


Looks pretty healthy to me.

10/11/11

Dacha Strategic Metals (DSM.v): Let us consider differing opinions on asset values

Firstly, let us conside Stan Bharti's opinion on asset values:

Dacha Reports Assets of US$1.62 Per Share With Inventory Valued at US$121.0 Million as of September 30, 2011

Secondly, let us consider the market's opinion on asset values in this five day chart:


Thirdly, let us consider a coffee-drinking GI's opinion of Stan Bharti's opinions:
The end

B2Gold (BTO.to) buys Auryx (AYX.to)

The 12 month chart of AYX.to is its own commentary on this deal:

Another comment is that the BTO.to management team is one of the sharper ones out there, so if they like the AYX assets, that's good enough for me. However Namibia is a bit of a departure from Central and South America and the ticket price on the deal makes for a big percentage uptick, so let's see how that goes down with traders today, what with the deal being all-share. Here's the NR

Press Release Source: B2Gold Corp. and Auryx Gold Corp. On Tuesday October 11, 2011, 8:20 am
VANCOUVER, BRITISH COLUMBIA--(Marketwire -10/11/11)- B2Gold Corp. (TSX: BTO.TO - News)(OTCQX: BGLPF.PK - News)(PINK SHEETS: BGLPF) ("B2Gold") and Auryx Gold Corp. (TSX: AYX.TO - News)(NSX: AYX.TO - News) ("Auryx") are pleased to announce that they have signed a binding agreement (the "B2Gold Transaction") to combine the two companies at the agreed exchange ratio of 0.23 B2Gold shares plus a cash payment of $0.001, for each Auryx share held, which represents a purchase price of approximately C$0.88 per Auryx share and a premium of 78% using the 20 day volume weighted average share price of each respective company, and a 74% premium over the Auryx closing share price on October 7, 2011 based on the closing price for the B2Gold shares as of such date. Based on the 20 day volume weighted average share price of B2Gold of C$3.81 per share, the transaction was valued at a total equity value of approximately C$160 million based on the fully-diluted in-the-money shares outstanding of Auryx.
The combination of B2Gold and Auryx will result in a merged entity holding a 92% interest in the Otjikoto gold project in Namibia, Africa and a 100% interest in two additional exploration projects in Namibia. The Otjikoto gold project has forecast average annual production of over 100,000 ounces of gold over a ten year life of mine based on a Preliminary Economic Assessment released in September 2011 with significant exploration upside. B2Gold is well positioned to progress development at Otjikoto given its strong funding capacity and a management team with significant mine development and operating experience.
The Auryx Board of Directors has approved the B2Gold Transaction and unanimously recommended that Auryx shareholders vote in favour of the B2Gold Transaction. Further, Auryx officers, directors and shareholders holding approximately 7.6% of the outstanding shares of Auryx have entered into lock-up agreements with B2Gold, pursuant to which they will vote their shares in favour of the B2Gold Transaction. The B2Gold Board of Directors has also unanimously approved the B2Gold Transaction.
Clive Johnson, President and Chief Executive Officer of B2Gold, stated: "We are pleased at the prospect of this strategic acquisition. The Otjikoto project is a quality asset that can potentially contribute another 100,000 ounces of annual gold production to B2Gold's impressive production growth profile. Our team looks forward to working with Auryx's experienced team to CONTINUES HERE

Now I really have to get going to that dental appointment thingy, Catch you laterz

Though I must add a quick comment on this

Right now the top story at Yahoo! Finance homepage:

Stock futures slip as Slovak vote awaited

On Tuesday October 11, 2011, 7:50 am
By Chuck Mikolajczak
NEW YORK (Reuters) - Stock index futures were lower on Tuesday after a strong rally in the prior session as investors awaited the results of a key vote by Slovakia on expanding the euro zone rescue fund. (continues here)

Are you freakin' kidding me here? The whole of the world's financial system trembling over a vote in Slovakia?? WTF?????

The Eurozone = One Almighty Clusterfuck

Chart of the day is...

...the Gold/Silver ratio, year to date (again):


This because it's a chart worth following closely right now. Right now metalheads should be willing the ratio to drop closer to its MAs.

In other news, the dentist's chair beckons your humble scribe again this morning. Pain>Posting.

10/10/11

Freeport's (FCX) Grasberg strike in Papua: Looks nasty

Here's the first part of this BNO report with details, click through for the rest:

TIMIKA, INDONESIA (BNO NEWS) -- At least seven people were shot on Monday when thousands of mine workers rallied and protested in the Indonesian province of Papua, officials said. One person has been killed.
Around 10,000 employees of Freeport-McMoran Copper & Gold Inc's Grasberg Mine, which is located near the Puncak Jaya mountain in Papua province, rallied in the city of Timika, demanding higher salaries and welfare benefits. According to reports, workers became angry after not being allowed to collect their personal belongings from their barracks.


During the massive protest, security forces opened fire against the crowds, killing 35-year-old Peter Ayamiseba at the Gorong-Gorong Bus Terminal in Timika. Papua Police Public Relations chief Commander Wachoyono said the fatal victim was employed at PT Sari Utama Food, which is a food supplier for the mining company.
Wachoyono also confirmed that a Mobile Brigade member was critically injured, ruling out rumors that one security personnel had died. At least six other protesters were also shot and transported to area hospitals for treatment, although their conditions were not immediately known.
The violent incident triggered further outrage and angry crowds burned three containers in the area, where tensions remain high. PT Freeport, however, has not responded to the incidents nor CONTINUES HERE

Hip Hop Hugo

The time: Last weekend
The artist: Venezuelan rapper Rodbexa (who rocks, by the way)
The audience: Hugo Chávez and a few others and even under chemo Hugo gets rhythmic and boppy

So how's investment in Peru's mining industry shaping up this year, Otto?

It's kicking ass, actually.


As it happens, 2010 was a record year for mining investment in Peru. And as it happens, 2011 is already up level with last year's figure in just the first eight months. So much for that whole meme about private industry being scared of Ollanta Humala, eh?

By the way, over $1.5Bn of the cash spent in 2011 comes from just two companies, Yanacocha and Xstrata. By the by the way, the source material for the above chart comes from here, the monthly mining bulletin published by the Ministry of Energy and Mining (MEM) today.

The East Asia Minerals (EAS.v) scam: Why hasn't ex-CEO Mike Hawkins been called out by the industry?

I think the main reason is that the industry is embarrassed about being suckered by the scumball Hawkins and his crew of scamrunners.

I was talking with a friend (respected mining industry figure) off record a few weeks ago and he told me a little about a conversation he had with his friend (a respected analyst in one of the big firms). Sadly I can't give you more than that on the IDs involved, but what 'respected analyst' mused to 'respected mining industry figure' was the difference between Bre-X and East Asia Minerals (EAS.v). The main problem with BRE-X, he mused, was that the scam had a hard landing* the story got too big too fast, too much light was shone upon the massive numbers it was causing in share price movements and market caps and the bullshit was discovered before the protagonists of the scam could get the thing back under control and cash out correctly. In other words, BRE-X got too noisy. It was too public. The officers involved went on record too much.

Whereas the East Asia Minerals (EAS.v) scam was run on heresay, whispers and off-record promises of great things to come, of "don't tell anybody but we got 20m oz/30m oz/pick-your-own-number here". It also suckered in a lot of decent and reputable names in the Canadian mining world, mainly because until that point, CEO Mike Hawkins had a decent reputation...I mean, nobody realized that he'd just gone to the dark side and was about to rip them all off bigtime.

So when the reality broke about EAS.v in May/June this year and the stock sank without trace, there were just too many red faces about to kick up too much of a fuss. But by then , Hawkins et al had cashed out and fled...with their money:


And as that $5.2m in gross proceeds came mainly from 20c options that Hawkins exercised, his cost base was minimal...in other words he took the $5m and ran.

Hawkins & Co learned from the BRE-X debacle and learned well. He ran his scam to perfection, suckered in the "right" people and when the time came EAS.v was given a soft landing by the industry and the press that feeds off its opinions because nobody wanted to stand up and say "I was fooled". In some ways I admire Hawkins for the stunt he pulled, but overall I'd still break his nose if I ever met him.

Disclosure: Never had a position in EAS.v, but was tempted for a while because "serious" players told me it was one to be on. Luckily I passed.

UPDATE: For all those coming from the 'Mexico Mike' site, you need to know that you mentor, Mike Kachanovsky, is a frontrunning pumping scumbag idiot and needs to go fuck himself before he loses any more of your money.

*especially for the poor dude who 'fell' out the 'copter

The South America World Cup Qualifiers: Round Two


Wow, matchday two already! Yep, tomorrow Tuesday the futbol is back on, with four matches to choose from and some decent bets available too. Here are the games and the odds supplied by Ladbrokes dot com:

Bolivia (5/4) Draw (23/10) Colombia (2/1)
Chile (4/7) Draw (13/5) Peru (5/1)
Paraguay (6/4) Draw (11/5) Uruguay (17/10)
Venezuela (6/1) Draw (3/1) Argentina (4/9)

(By the way, there's also Mexico vs Brazil tomorrow, but you bet on friendlies at your own peril).

First the good news, as our bet Friday paid off in style and Peru beat Paraguay 2-0. This means our original $100 virtual betting bankroll is up to $156 (and thanks for the feedback from last week's post, including the guy (reader 'HG')mad enough to take my call at face value and put his cash on my brainwanderings...don't make it a habit, dude). Thus we got money to burn and we're gonna burn it on three bets.

The most interesting fixture is Chile vs Peru and although going to Santiago and winning is always very tough, even for the top ranked teams like Argentina or Brazil, the 5/1 offered by Ladbrokes is too tempting to pass over (I'd personally handicapped it at 3/1 before checking their page). Peru played well in Lima last Friday, Chile played poorly in Buenos Aires last Friday, so the away team is going in with its tails up and the home team are under pressure to perform. The home advantage in Chile is very strong, however, so even with last week's games in mind Chile is clear favourite for this match and there's a lot of rivalry between these two sides, so passion will run high

To the betting! We're going to hedge our bets on this one and put $10 on the draw at 13/5 (which would pay $36) and then $10 on the Peru win at 5/1 (which would return $60). Therefore a Chile win sees us losing $30, a draw gives us a $16 profit and a Peru win triples our overall wager.

The other bet tomorrow is for Argentina to beat Venezuela in Venezuela. It's a short price for a good reason and we're putting $50 on that at 4/9, for a total return if successful of $72.22. To sum all that up:
  • $10 on a Chile /Peru draw, price 13/5, total return envisaged: $36
  • $10 on Peru to win, price 5/1, total return envisaged: $60
  • $50 on Argentina to win, price 4/9, total return envisaged: $72.22

Which leaves $86 in the pot for another day. And let's see how we get on.

UPDATE Tuesday PM: And now you know why I don't do these things for a living. All bets lost and just $86 to take to the next round, mid-November. Humph.

Chart of the day is...

...gold, monthlies:

If you look very very closely, you may be able to spot a trend. 

Today we also offer up a bit of random Robert Frost because it popped into my head last night and luckily, blogging means never having to suffer alone. And before you ask, yes I looked it up to make sure.

Never ask of money spent
Where the spender thinks it went. 
Nobody was ever meant 
To remember or invent 
What he did with every cent

10/9/11

The IKN Weekly, out now

IKN127 has just been sent to subscribers and a woefully poor edition it is, too. Hey, at least I admit it.