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  • Complete Third-Quarter Gold All-In Costs Show That Gold Investors Should Be Very Comfortable With Their Investment [View article]
    I always find your articles to have valuable information. But frequently I feel that they are unrealistically optimistic on the prospects for gold miners. I do not understand why you feel that "most gold is produced at prices higher than the current gold price, and that is bullish for the gold price." Since gold is a commodity that is not consumed, and annual gold production is tiny in comparison to the vast existing holdings of gold, lower new supply can only have a small influence on price.

    Only a change to a much more positive sentiment toward gold will increase prices, so miners will need to make better progress in cutting production costs.
    Dec 27, 2014. 09:22 AM | 4 Likes Like |Link to Comment
  • Seadrill Shows Just How Little Insider Buys Can Mean [View article]
    I wonder if the large stock purchase will have any impact in mitigating the likely class action lawsuits, given the management actions (e.g., the CEO in August saying the dividends would continue) could be interpreted as misleading to outside shareholders?

    I do not think that SDRL is a company on the verge of bankruptcy, as it has a good business with some key advantages over its competitors. Of course, when oil prices drop and E&P spending stops, a company with a big debt load will be hit hard. But if SDRL survives until oil prices recover over time the shares will go back up.
    Nov 30, 2014. 05:51 PM | 1 Like Like |Link to Comment
  • New Gold: There Is A Lot More To The Story [View article]
    Using GG as an example? GG stock was $12.72 at the end of 2002. Now, 14 years later, it is $19.64. So GG stock has gained about 54% while the overall S&P 500 gained 135%. And GG stock does not pay a huge dividend in comparison to the average of yield of the S&P 500. So I am do not see GG as a "lighthouse" example of how investing in a rapidly growing gold mining company builds investor wealth. GG stock shows no evidence over having overcome the declining gold price environment over the past 3+ years.

    That being said, I agree that NGD is positioned to grow faster than most gold miners. And I have held NGD stock - Just in case gold prices ever start to go up, and growing gold production starts to matter again.
    Nov 30, 2014. 12:20 PM | Likes Like |Link to Comment
  • Gold Stock Apocalypse Is Epic Buying Opportunity [View article]
    "Like all low-price extremes, gold stocks' recent lows were driven solely by an emotional capitulation."

    I think that the continuing awful operating results and deteriorating balance sheets of many precious metals miners had a lot to do with their share prices declining.

    When gold was below $350, AISC was way below where it is today. The price of gold does not directly drive gold miner share prices. Like in any industry, expected future profit streams and profitable growth are the key factors. Once a number of miners can record positive EPS numbers, their share prices will increase.

    And what is a "general stock" that you refer to? There are many industries represented among the companies in the S&P 500, and gold mining is one of them. Bias against gold mining company stocks is a result of poor operational and financial performance by gold mining companies. There have been many well-publicized executive management blunders. And most people do not think precious metals mining is has much to do with economic growth and improved well-being.
    Nov 18, 2014. 12:41 PM | 1 Like Like |Link to Comment
  • What It Really Costs To Mine Gold: The Newmont Gold Third Quarter Edition [View article]
    Extensive consolidation of miners will occur, whether by mergers and acquisitions, or by failures and the subsequent purchase of assets by surviving companies. All market signs indicate that ABX and NEM should have merged, and that only self-interest of company executives prevented that from happening.
    Nov 17, 2014. 10:57 AM | Likes Like |Link to Comment
  • The Gold Market Is Going Insane [View article]
    This blog post was interesting to read, as Avi Gilburt's posts tend to be. But I am not sure why the word Silver was not in the title, because it spoke much more about past reactions of Silver prices to Fed statements than it spoke about past movements in Gold prices. Silver markets differ from Gold markets.

    The addiction that developed economies with fiat currencies have to monetary stimulous is more like late stage alcoholism or heroin addiction. Given how "hooked" on monetary stimulous the USA economy has become, if the Fed stops then the addicts would get really sick and some addicts would possibly die. My understanding is that cocaine withdrawal resolves quickly and that (unlike for chronic heroin or alcohol addition) death from siezures during cocaine withdrawl are extremely rare. Talking the addict into undergoing the rigorous rehabilitation that would be needed to feel okay without the monetary stimulous would require well thought out interventions, and I do not think that we have strong enough leadership in place or strong enough political incentives for our Federal government "leaders" to go on that intervention call...

    Would announcement of the next "fix" cause gold prices to skyrocket? Probably not. I think that we are past the point of gold prices hyperreacting to additional monetary stimulous events. But I would not be surprised to see gold prices reach $1,500 within the next two years, as the result of market sentiment and a number of supply and demand factors (fundamentals will play a role). Does sentiment and the price of gold first need to break down further? Maybe, but that does not matter much to me.
    Oct 21, 2014. 12:17 PM | 2 Likes Like |Link to Comment
  • Seadrill Looking To Make Lemonade From Lemons [View article]
    Of course SDRL is volatile and facing a lot of uncertainty. When I skimmed through the recent SA blog posts and comments, it seems that some people allocated too much of their investment portfolio to a risky stock in a volatile industry. I am happy to double up at $22/share and would not consider putting core retirement funds or more than 5% of my "play money" into SDRL.
    Oct 17, 2014. 02:49 PM | Likes Like |Link to Comment
  • Deflation + Volatility = Bull Market In Gold [View article]
    I do not consider gold at $1,240 per ounce to be "on the ground floor" - The price in mid-October 2014 is not much different than it was a year ago. Silver prices have been beaten down much more over the past year. The US dollar cannot continue to strengthen at the pace it has over the past 3 months, but it is still viewed as a safe haven and developed country central bankers see no need to back their fiat currencies with precious metals. There is a stagnating Europe and a still stagnant Japan. But gold prices are not acting like there has been a recent significant change to economic conditions - Why? There has not been a major change to economic conditions. Oversupply of commodities has been growing for months. Very few people believe that the will be a total collapse of the global economy.
    Oct 17, 2014. 11:39 AM | Likes Like |Link to Comment
  • Is It Time To Just Give Up On Gold? [View article]
    I have not "given up" on the possibility that gold prices and gold miner stock prices could appreciate faster than other investments. While I question advice to go big into gold, like Marc Faber's recent recommendation to have 25% of assets in precious metals, over the Summer I did increase my allocation to gold and gold miners. While I am not expecting gold prices to crest $1,500 per ounce in the next year, I do expect that Jeffrey Currie (Goldman Sachs) will have be wrong with his forecast of gold prices dropping to $1,050 per Oz by the end off 2014.
    Oct 15, 2014. 12:51 PM | Likes Like |Link to Comment
  • Newmont's Lack Of Acquisitions Has Been Frustrating [View article]
    NEM management has had a tough time handling the portfolio they already have. The value of precious metal miners has dropped dramatically over the past 3 years, and NEM does not look like wheat among the chaff. In addition, there is not yet strong evidence that this "bloodbath" is over - The GDX is down 56% since January 2013, and down 18% from where it was at the beginning of last month.

    Few large companies have ever performed so abysmally for their shareholders as NEM has performed for its shareholders over the past 3 years. I see no case at all for NEM to expand; rather, they need to contain losses and recover from their past mistakes. On the other hand, NEM should have lept at the chance to merge with ABX. ABX has also been a poorly managed company, but the precious metals mining industry needs to consolidate, and an ABX + NEM portfolio looks much better than NEM's portfolio.
    Oct 10, 2014. 04:01 PM | 1 Like Like |Link to Comment
  • Economic Atonement [View article]
    To me, one of the most interesting outcomes of the huge QE program is that there has not been significant inflation of consumer prices, and commodity prices have overall been flat. Low interest rates for the foreseeable future could continue to have supply growth keep inflation in check. No surprise that the European and Japanese central banks are starting to mimic the USA policies. Their economic performance has been lagging that of the USA, and I think that the central bankers for major fiat currencies actively "collaborate" on monetary expansion.
    Oct 8, 2014. 12:30 PM | Likes Like |Link to Comment
  • Barrick Shines In A Bleak Gold Landscape [View article]
    How can any blog about ABX stock not mention that ABX has a crushing amount of debt, and that its executives have made more management missteps than well-run natural resource companies?
    Sep 24, 2014. 09:09 PM | Likes Like |Link to Comment
  • Can Agnico Eagle Mines Continue Beating The Market? [View article]
    I do not understand the title of this blog post. It must have been written many weeks ago. AEM is down more than 12% over the past month, while the S&P 500 has been flat over the past month.
    Sep 18, 2014. 01:36 PM | 1 Like Like |Link to Comment
  • Death Of The U.S. Dollar [View article]
    How can anyone ignore the fact that other major currencies are issued by central banks that also have enormous debt. Eventually the Great Pumpkin will visit Charlie Brown in the pumpkin patch, but think of all the candy the other kids got while he was waiting.
    Sep 14, 2014. 10:21 AM | Likes Like |Link to Comment
  • Why Is Peter Schiff Recommending People Save Worthless Dollars? [View article]
    The majority of Americans have little to no retirement savings. Social Security programs are facing funding issues. And there are retirement savings vehicles that can provide decent return at reasonable risk. I am surprised that there is no mention of retirement savings in this blog.
    Sep 8, 2014. 09:30 AM | Likes Like |Link to Comment