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The Gold Report

 
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  • Finding Gold Dollars In Nevada: Thomas Drolet
    Thu, Nov. 20 ABX, GDX, NUGT 1 Comment

    Summary

    • Gold is highly responsive to geopolitics, but I see the price as turning from a bottoming process.
    • Selective gold investors look for more than one product line, a combination of gold and silver and royalties.
    • Patient investors will be well rewarded for waiting out this period of a strong U.S. dollar; for a quick buck, gold mining is not for the faint of heart.
  • Credit Suisse Analyst Michael Slifirski: New Non-Chinese Graphite And Vanadium Supply Could Create New Demand
    Thu, Nov. 20 SYAAF Comment!

    Summary

    • The graphite market has been constrained by historic uses that have a slower growth rate than the new emerging opportunities, specifically electric vehicles.
    • Aluminum anodes represent a new application for graphite with vast market potential.
    • China has been the leading graphite producer, but as wage pressures and strip ratios increase, China becomes less competitive.
  • Chen Lin Says Gold Miners Need To Produce At $1,000/Oz. Or Less To Survive
    Wed, Nov. 19 AEM, ALIAF, GG 6 Comments

    Summary

    • The fall of gold from $1,900/oz is a healthy correction; this creates buying opportunities for long-term investors.
    • We continue to look for the gold bottom.
    • There's a possibility of final selloff to flush out all the weak hands and all the leveraged positions.
  • Jack Lifton Says Innovation Is The Key To REE Independence
    Wed, Nov. 12 REMX Comment!

    Summary

    • The idea of building a very expensive mine coupled with a very expensive separation plant has put an economic burden on the development of rare earth sources.
    • Pilot plants are underway in North America and Europe for at least two non-solvent extraction technologies.
    • A genuine change in how REEs are processed may be the salvation of the non-Chinese industry.
  • Frank Holmes Talks No-Drama Investment Strategy
    Tue, Nov. 11 FNLPF, FNV, GOLD Comment!

    Summary

    • I advocate maintaining a 10% weighting in gold, 5% in gold stocks and 5% in gold jewelry or coins, and to rebalance each year.
    • The biggest thing that's really hurting commodity markets, and gold in particular, is a stronger dollar.
    • I look for companies that are trading way below their book value and are candidates to be taken out.
  • Paul Adams: Macro Trumps Micro In Resource Sector
    Wed, Nov. 5 BHP, KGRSY, RIO Comment!

    Summary

    • Junior miners in Australia have suffered from the downturn in commodity markets.
    • The supply/demand fundamentals for nickel suggest that prices should start to rise as Chinese stockpiles of Indonesian nickel ore get depleted, leading to better performance for nickel companies in 2015.
    • We're likely to see zinc producers and developers outperform their peers in other commodities as several large zinc mines shut down.
  • Oliver Gross Says Peak Gold Is Here To Stay
    Wed, Oct. 29 ABX, AEM, AU 11 Comments

    Summary

    • Today, investors can buy gold and silver stocks at decade-low valuations and historically low bullion-to-equity valuations.
    • Nobody cares about precious metals equities today, but when the bubble in the broader markets bursts, we will see a massive shift in market sentiment and investors behavior.
    • Precious metal equity valuations are among the lowest for the last 30 years, so this could be the most attractive environment for contrarian investors in a couple of generations.
  • Stefan Ioannou: Copper, Nickel, And Zinc Won't Be Cheap For Long
    Wed, Oct. 22 BHP, CPPMF, CSFFF Comment!

    Summary

    • Zinc is facing a significant supply deficit into 2016, so we could see zinc rise above $1.50/lb fairly quickly.
    • By 2017–2018 we will face the consequence of a lack of new copper supply, which is demand outweighing supply.
    • There is a bullish argument that we could see the nickel market slip into deficit by as early as mid-2015.
  • An Ebola Armageddon Could Trigger A Rebirth In Gold And Silver Prices: Eric Sprott
    Tue, Oct. 21 ABX, FNV, GG 4 Comments

    Summary

    • There is already a shortage of gold and silver in the markets without a corresponding increase in the price.
    • Closing mines in Africa would just exacerbate the supply problem and cause things to finally change dramatically to the upside in prices as people publicly acknowledge the fundamentals.
    • The natural Armageddon of disease could cause a financial Armageddon and precious metals are the natural comfort play.
  • H.C. Wainwright Analyst Jeff Wright Names 2 Companies That Could Turn The Gold Trend Upside Down
    Thu, Oct. 16 ABX, PVG, RIC Comment!

    Summary

    • The recent sell-off in gold was predicated on a stronger dollar more than anything else.
    • The survivors will be the mining companies that can extract savings from operations while limiting discretionary exploration.
    • For now, there is just not an appetite for true exploration; even positive news is being met with a shrug.
  • John Kaiser's Tips For Escaping The Resource Sector Swamp Alive
    Wed, Oct. 15 ABX, AEM, CDKNF 4 Comments

    Summary

    • Copper and iron are faced with oversupply in the next couple of years.
    • Nickel is a special situation because it was being oversupplied until Indonesia imposed an export ban on raw laterite ore.
    • The one metal I think will realize higher prices in the next few years is zinc.
    • Global economic growth is a plausible driver for higher real gold prices.
  • Must Read: Top Companies Adrian Day Sees As Stable In A World That Is Not
    Tue, Oct. 14 AAU, ABX, EPGFX Comment!

    Summary

    • The number one effect on the price of gold is the dollar.
    • The irony here is that the geopolitical tensions that one would have expected to help gold have actually helped the dollar and, therefore, hurt gold.
    • If we see several weak economic reports in the next few months, the Fed is going to make noises about continuing to ease; pushing the dollar down and gold up.
  • David Morgan's Secret To Being Grateful, Even At $17 Silver
    Thu, Oct. 9 ABX, AG, BCEKF 3 Comments

    Summary

    • There was a deficit of silver, which means fundamentally the price should be higher, but real prices are determined in the paper markets and the pressure there has been downward.
    • As much as 70% of the silver produced is an offtake of mining for base metals; these producers really don't give a hoot about the price of silver.
    • The grades being mined now are grades that were not considered worth mining three decades ago, with little high grade left, companies go after whatever can be done profitably.
  • Catalyst Check: Natural Resources Watchlist At 3 Months
    Tue, Oct. 7 CNKEF, DVN, GDXJ Comment!

    Summary

    • Junior mining sector equities in the gold space, as proxied for by the Market Vectors Junior Gold Miners ETF, have outperformed gold since the June Cambridge House conference.
    • In the current environment, grassroots exploration companies are finding it difficult to attract financing to generate catalysts.
    • Projects that are more advanced may be a better option in the near to medium term; projects that have the financing support to generate the catalysts required to move forward.
    • The energy market has been ugly and will have to rebase, but some of these companies could do well in the process.
  • Canaccord's Joe Mazumdar Shares His Favorite Get Rich Slow Schemes
    Thu, Oct. 2 ABX, AKG, GDXJ Comment!

    Summary

    • Investors prefer owning the equity now rather than owning gold.
    • Investors should seek companies that are funded to generate significant catalysts going forward.
    • Companies that are fully funded to production are less susceptible to changes in their equity prices in the near term.
  • Jay Taylor Urges Investors To Stay Liquid For The Coming Gold Boom
    Wed, Oct. 1 AAU, AEM, AKG 3 Comments

    Summary

    • We have two different markets for gold: One is an honest market for physical metal; the other is a less honest paper market.
    • We must distinguish between those gold ETFs that are honest and those that might not be so honest.
    • I can't imagine we won't see a major breakdown in the global financial system within a year from now.
  • Richard Karn's Advice For Avoiding The Walking Dead
    Thu, Sep. 25 Comment!

    Summary

    • According to the Australian Securities & Investment Commission, 146 companies in the mining sector went into administration (bankruptcy) during the fiscal year ending June 30, 2014.
    • We expect a fresh wave of failures within the next six to eight weeks as more resource companies become insolvent.
    • In the final shakeout, we are anticipating a number of mismanaged companies will deservedly go under and some very good projects will be picked very inexpensively.
  • Sprott Fund Manager Jason Mayer's Guide To Resource Stock Profits
    Wed, Sep. 24 ABX, BIREF, DPGYF 1 Comment

    Summary

    • The strength of the U.S. dollar has led people to doubt the need to hold either gold or gold-related equities in their portfolios.
    • The bottom line is North American natural gas production continues to hit record highs.
    • Junior miners that have very high-quality projects have been able to access the capital markets and issue equity.
  • Tell Us, Christos Doulis, Can Gold Act As A Safe Haven Again?
    Tue, Sep. 23 ABX, AEM, AUY 2 Comments

    Summary

    • The World Gold Council, which gets its numbers from Thomson Reuters GFMS, reports that total gold demand in Q2/14 fell by 15% versus the same period in 2013.
    • The fact that central banks are buying gold tells me that gold—the currency between states and central banks—is still regarded as an important part of the reserve mix.
    • We're still in a stagnant global economy. The fear associated with 2008–2009 has receded but when it comes to unemployment, median household income, etc., the new normal is more ugly.
  • Eric Coffin: Can Investors Still Find Tenbaggers?
    Thu, Sep. 18 AEM, CDKNF, RIO 1 Comment

    Summary

    • If gold stays at $1,200–1,250/oz for an extended period, there will be mine closures.
    • Not all mines have the same costs, but the average all-in cost per ounce for gold miners is about $1,200/oz.
    • Find the projects with the highest potential for resource growth or new discovery, and management teams that know how to explore them and finance them on the best possible terms.
  • Jeff Desjardins And James Fraser Look At Junior Miners In A Way That May Surprise You
    Wed, Sep. 17 AEM, CDKNF, GDXJ Comment!

    Summary

    • Quality management teams have found ways to continue to move projects forward.
    • Developers with high-quality assets will be subject to M&A activity once they are sufficiently derisked because larger companies want to buy proven resources at rock-bottom prices.
    • Investors should look for developers with a resource of at least 3 Moz with high grade and in a safe jurisdiction.
    • As we move into the fall, we expect to see more separation between the better companies and the weaker ones.
  • Brien Lundin Says Don't Miss This Buying Opportunity
    Tue, Sep. 16 AAU, AEM, AKG 2 Comments

    Summary

    • The real result of quantitative easing in the U.S. and loose money policy throughout the Western economies is a virtual flood of liquidity looking for places to land.
    • There are some factors that I think will push the junior resource stocks and the metals higher this fall.
    • When the market turns around, the major producers will cherry pick the best of the deposits at reasonable prices.
  • Jeff Killeen: Cash And Catalysts Rule The Day
    Thu, Sep. 11 BTG 1 Comment

    Summary

    • Companies that realize further cost improvements in the second half of 2014 are also likely to get investors' attention.
    • On the developer side, we're starting to see share prices get rewarded for good drill results, resource growth and even new discoveries.
    • Better yields will catalyze the generalist investor back to investing in gold stocks.
  • Filipe Martins: African Miners That Can Generate Cash Flow And Dividends
    Thu, Sep. 11 AU, CELTF, GOLD 2 Comments

    Summary

    • We forecast a $1,350/oz gold price from roughly 2015, but the real risk is that the gold price could fall before it rises, given the threat of higher borrowing costs.
    • Most recently, we haven't seen the increases in physical demand from China and India that normally follow gold price dips; this is a cause for concern.
    • Companies have recut mine plans and have tightened their economic assumptions to focus on grade and profitability, rather than big net asset values.
  • Sprott's Charles Oliver: Gold At $1,500 By Christmas?
    Tue, Sep. 9 GLD, IAU, SGOL 24 Comments

    Summary

    • Gold's fundamentals remain intact, and gold will regain its reputation as a unique store of value.
    • Countries are debasing their currencies, which leads to investors moving into hard assets, as confirmed by U.S. stock indexes reaching record levels.
    • Gold and silver and precious metals equities will recover in the not-too-distant future.
  • Raj Ray: Miners' Cost Cutting Set To Deliver In Late 2014
    Thu, Sep. 4 BHP, FCX, KGILF 1 Comment

    Summary

    • I don't see a big driver to push gold higher over the next six to eight months.
    • The second quarter results from some companies are starting to show the benefits of mine optimization plans initiated last year, but it's still early.
    • I still like producers with operational flexibility and the ability to generate cash even in a muted gold price environment.
  • How Is Doug Casey Preparing For A Crisis Worse Than 2008?
    Wed, Sep. 3 GLTR, DBP, WITE 3 Comments

    Summary

    • Central banks all around the world have attempted to revive their economies by lowering interest rates to all-time lows, causing huge distortions and leading to liquidation.
    • If a billion dollars panics into silver and a billion dollars panics into gold, silver is going to move much more rapidly and much higher.
    • The mining companies that I think are worth buying now are well-funded, underpriced and sitting on economic deposits with proven management teams.
  • Keith Phillips: Merger And Acquisition Prey Offer Compelling Buying Opportunities
    Thu, Aug. 28 AEM, AGI, APO 3 Comments

    Summary

    • There is a lot of M&A dialogue going on; I'm optimistic that activity will continue to be strong and, with any luck, be stronger than last year.
    • In the past several months, companies that have dealt with their internal issues are now trying to capitalize on lower target valuations to achieve longer-term goals.
    • Value is always a core component of merger dialogue, but in today's market, buyers are increasingly focused on doing value-accretive deals.
  • Keep The Faith, Says Michael Fowler: Juniors And Midtiers Poised For M&A-Fueled Breakout Once Gold Recovers
    Tue, Aug. 26 AEM, AGI, ALIAF 3 Comments

    Summary

    • Most private equity managers don't have the expertise to actually run a mine; they generally prefer a big stake, but not actually run the company.
    • If the gold price goes up, M&A activity will gain steam.
    • My favorite space at the moment is the junior to midtier producers.
  • Fund Adviser Björn Paffrath's Mantra: In The End, Performance Matters
    Sat, Aug. 23 ARVCF, CSFFF, FNLPF 1 Comment

    Summary

    • The fittest mining companies will survive, especially in the junior and exploration sector.
    • Companies that will survive are those with access to capital, that have great projects and that have focused on bringing the all-in costs down and running their operations more efficiently.
    • This fall, we will see more mergers and acquisitions activity, especially in the mid tier sector.
  • Junior Mining Companies That Will Be Making Beautiful M&A Music: AgaNola's Florian Siegfried
    Thu, Aug. 21 GDX, GDXJ, GLD 1 Comment

    Summary

    • Precious metals turnaround stories are where you can have the best returns if the market continues to go up.
    • Investors have to find the precious metals miners that have stabilized their operations and that have sufficient cash to go through the restructuring period as they make operational progress.
    • There are many first-time buyers, including private equity, investing in the precious metals sector because it is ridiculously cheap at this point.
  • Björn Paffrath: Mining Sector Bottom Is In And Opportunities Abound
    Tue, Aug. 19 CALVF, DNGDF, DRGDF 1 Comment

    Summary

    • Since the 2008 crisis, many well-known indexes, such as the Dow Jones Industrial Average or the German DAX, have almost doubled, and many individual companies have performed even better.
    • We will have a painful correction of 30% or more. Maybe it started already, but it's tough to say because there is still a lot of liquidity in the market.
    • For an investor looking for a good opportunity, the mining sector is the place to be. You have to have patience so that you don't get shaken out on pullbacks.