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  • What Does History Say About The First Rate Hike And Stocks? [View article]
    I think, while we're discussing lessons from history, an important point about context needs to be made. When was the last time a rate hike cycle started after a six year bull market that saw indexes rise to record highs during one of the weakest post-recession economic recoveries on record? I think its fair to say that markets have discounted a significant amount of future economic recovery. Best case scenario is that future economic recovery continues and maybe markets remain flat for a while. Worst case is the recovery does not live up to expectations and we see a sharp reversal of some of those gains.
    Nov 24, 2015. 01:11 PM | 2 Likes Like |Link to Comment
  • Kinross Gold - Investigated For Possible Bribery Case In West Africa [View article]
    Nationalized? Really? What does the government of Mauritania know about operating a mine? They have virtually 0 expertise locally, and no major internationally miner would touch it if they were to nationalize it. It would be reclaimed by desert sands within a few years and 100% of jobs would be lost.
    Oct 5, 2015. 01:42 PM | 2 Likes Like |Link to Comment
  • Kinross Gold Is A Stock To Avoid [View article]
    A clearly biased article, you make quarter over quarter comparisons when they are least favourable, mixing in year over year if that better supports the negative bias. The most recent quarter is not representative as it included the effects of flooding at Chile operations. In general AISC have been coming down for the last couple of years and latest projections are for further drops ($1000 - $1100 is outdated). You claim Kinross is a mid-sized gold miner and then proceed to compare it with 5 peers that include the 3 biggest gold miners in the world. You also claim that their AISC are among the highest in the industry. Not true. They are somewhere in the middle on that basis.

    You make no mention of the price to own a piece of Kinross, which is of course a key part of any investment decision. Even after the recent rally in shares, Kinross is cheaper than most of its peers on many metrics, some of which may be justified by higher costs. In fact typically higher cost miners will perform better if the price of gold were to rise since they in effect have higher leverage to the price of gold.
    Sep 19, 2015. 10:31 AM | 5 Likes Like |Link to Comment
  • Amazon boosted to Strong Buy at Raymond James [View news story]
    I still remember how Amazon shares rallied on initial hype over Kindle Fire tablet and then phone. Then despite the flop in hardware, shares barely flinched. Now they are more or less exiting that line of business, and shares are rallying, at least in part, due to perceived cost savings.
    Aug 27, 2015. 11:31 AM | 2 Likes Like |Link to Comment
  • Kinross: To Sustain Its Leading Position As One Of The World's Biggest Gold Producers, Has To Replenish Its Mineral Base [View article]
    Keep in mind the exchange rate used in those IRR calcs is a lot higher than current CAD/USD rate. The gold price in Canadian $$ is currently higher than when that FS was done and most of the projects costs would be in Canadian $.
    Jul 15, 2015. 01:26 PM | 1 Like Like |Link to Comment
  • Stocks set for strong open after stellar U.S. jobs report [View news story]
    "Stellar"... really?
    May 8, 2015. 10:08 AM | Likes Like |Link to Comment
  • Amazon +15%; 3 upgrades arrive, JPMorgan values AWS at $66B [View news story]
    Even with the generous 16x next years EBITDA valuation of $66B given by JPM, that leaves a retail segment with a market cap of $150B based on today's price. I noticed most analysts assume Amazon can eventually earn the same margins internationally as it does in NA. This is not at all certain but even giving them the benefit of the doubt that they can turn around international segment, that means margins of 3% on lets say $100B in sales. That's a potential operating margin of $3B or $6.21/share.

    That translates to a price of 50x potential operating margin (not net earnings) with sales growth (after backing out AWS) of about 12%.

    Maybe someone can explain to me how that is a reasonable price to pay.
    Apr 24, 2015. 04:59 PM | 5 Likes Like |Link to Comment
  • Why Amazon Is Still Cheap [View article]
    Interesting methodology for valuing businesses... Apply price/revenue multiples of competitor businesses with margins many times that of Amazon. I think my favorite is the Lululemon analogy. You make it sound conservative to value Amazon's retail business at 1/3 of Lulus price/sales, even though Lulu has margins more than 10x Amazon's.
    Mar 20, 2015. 09:39 AM | 5 Likes Like |Link to Comment
  • The 'Real' Reason Gold Will See $5000 [View article]

    I have commented occasionally here when I thought your articles strayed into fundamentals territory (QE, etc.) but I have to say, even before this latest call, you have convinced me of the absolute dominance of sentiment, at least with regard to the precious metals markets.

    New respect for your musings!
    Nov 3, 2014. 04:56 PM | Likes Like |Link to Comment
  • Victory For The Bears [View article]
    Certainly nothing to justify all time highs in stock market. The first positive economic news didn't really start until the last quarter of 2013.
    Oct 29, 2014. 10:04 AM | 1 Like Like |Link to Comment
  • Victory For The Bears [View article]
    That might be true of 2009 - 2010, which was probably recovery of oversold market as you say, but the rally continued through 2013 to reach all time highs with little or no signs of economic improvement, all on the back of FED support. Also lets not forget how excessive valuations were in 2007 before the crash.
    Oct 28, 2014. 10:23 AM | Likes Like |Link to Comment
  • Victory For The Bears [View article]
    "Bear market needs the US to go into recession"

    In normal times I'd agree. But the corollary of that is that a bull market needs economic expansion and a 6-year, record-smashing, tripling-of-S&P bull market needs a booming economy. Now if you believe that that is just around the corner, there may be some justification for this bull to continue. But this market rallied for 4 years without any signs of economic improvement and although we have begun to see improvement of late it has not been robust and yet the market continues higher.

    You cannot quote the recent history of how bear markets have typically evolved without acknowledging that the recent bull market has not followed the script of recent history.
    Oct 27, 2014. 09:54 AM | 3 Likes Like |Link to Comment
  • GLD: 'I Am As Mad As Hell, And I Am Not Going To Take This Anymore' [View article]
    You got that right. And stock buybacks almost always peak near the top of market. The last time we had a surge in buybacks was in 2007. Almost none in 2009.
    Oct 27, 2014. 09:25 AM | 1 Like Like |Link to Comment
  • Update: Kinross Gold Sells Fruta Del Norte Project [View article]
    I also thought the deal was not factored into the valuation, and yet the stock price went down the day the deal was announced and has not recovered.
    Oct 27, 2014. 12:09 AM | Likes Like |Link to Comment
  • GLD: 'I Am As Mad As Hell, And I Am Not Going To Take This Anymore' [View article]
    "...if the exact same action (QE) does not cause the same result each time - but, in fact, seemingly causes opposite reactions, can we logically consider that it was the proximate cause in even some of the cases?"

    Your conclusion seems to fly in the face of your sentiment-based analysis (which btw I have great respect for). QE is essentially creation of money and gold is a competing form of money, so it wouldn't be unreasonable to make a causal connection to an increase in the dollar price of gold. And in fact that is what we saw over the full course of QE. The fact that sentiment became overly positive by the time the 3rd round began and we saw the opposite reaction to QE3, does not negate the effects of QE on the price of gold. It only demonstrates that the reaction was overdone, just as your sentiment analysis found.
    Oct 26, 2014. 11:42 AM | Likes Like |Link to Comment