But Dan.... everyone knows that big hedge funds are too smart to ever lose 15%.

Casey doesn't actually say "ten-bagger". That's an interpretation I apply to his numbers. just based on proven/probable reserves, and an operating cost of $161, they are closer to a five-bagger. The thing is, though, that they have not finished surveying their property, either in area or in depth.

So, let's say it's a 7.5-bagger. What are the chances of Chavez ruining their business one way or the other? Your guess is as good as mine. I'm less sanguine than others I have read, and I'd say 70%.

So that leaves us with a 30% expectation of a 7.5-bagger, or an expectation of a 2.25-bagger. Of course, we have to round to the nearest bag, so we're down to 2. Still, if I could have 100 plays with 2-bagger expectations, and know that the average would pan out, I wouldn't complain...

Doug Casey devoted his monthly newsletter to KRY this month. Basically, same story as GRZ: huge potential with Chavez serving as the counterweight. Casey's opinion is that the potential ten-bagger in KRY make it worth the much smaller risk that Chavez will nationalize.

GRZ - yeah, talk about risk versus reward. GRZ has as much or more of both than any stock I've seen.

Chavez is not going to want to appear to be less radical than one of his own proteges. Still got that GRZ?

Make that $4, now. I'm not sure I've ever seen an after-hours chart like that. Their PR was great, but I guess there was a note of pessimism in the CC <VBG>

When I sold a house in So Cal back in 2001, my thinking was that the stock market would tank a lot further, and that the negative "wealth effect" would hurt housing prices, too.

I was absolutely right about the stock market tanking, and couldn't have been more wrong about any connection to housing.

After that whipping, I'm very hesitant to disbelieve prognostications that a falling housing market will help the stock market. It doesn't make sense that it should happen, but I wouldn't bet much against it...

Waiting for the $US to collapse is an exercise in learning patience. I've been expecting it for over fifteen years. I'm just afraid that when it finally comes, I'll be too old and befuddled to even remember that I've been waiting for it.

Looks like I picked the wrong week to quit sniffing glue...

Geez, what happened to our friend Huey?

Dan - hard to tell which was funnier, the Metropole article or the ResourceInvestor article. Since the former was actually trying to be funny, I'll give them the nod...

BTW, do you follow Doug Casey? I bought a whole bunch of his recs two months ago, and am up about 15% since. They're mostly pre-production gold and silver plays, but he's recently come out with his opinion of the bigger guys (he's very high on NEM)...

I don't know about KGC. They were buying CLG stock for a while there, but they stopped (I think) well over a year ago...

Did you see CLG's news?

http://biz.yahoo.com/iw/060830/0158834.html

That one's a 120% gainer for me since you recommended it two years ago, but I think it has a long way to go still...

I haven't given much thought to GRZ since I sold back in April. Seems the story hasn't changed. A company that's extremely undervalued if left alone, and extremely overvalued if Chavez decides to change policy. The guy reminds me so much of Gaddafi that I sure wouldn't trust him with much money...

Do you read Mauldin? Besides quoting this week's Roach, he has a remarkable graph showing the correlation between the housing market (lagged 12 months) and the stock market. If that correlation holds, the market is in for a very tough time, because the housing collapse hadn't begun 12 months ago and, besides, it's gonna get a lot worse.

I think the Fed will respond by cutting rates in a hurry, mistakenly believing they can bail out the housing industry that way. The $US will fall, and PM's will rise.

My usual wishful thinking, anyway...

Only until the Fed-will-start-cutting rallies...

If you want to sell short, you may need a second broker, as some brokers are just lousy at getting shares. The three I use (Fidelity, Tracktrade and Interactivebrokers) all have shares of NTRI...

...and we still have the Iran Crisis Selloff coming at the end of the month, when the Security Council's deadline expires, and Iran tells the rest of the world to take a flying leap.

Gold looking good here. Seems like whatever the Fed does in September, it'll be good. If they don't raise (and I think there's zero chance that they will), they won't be "defending the Dollar". If they do raise, they'll look amateurish and panicked...

we will ultimately all be the losers in this battle.


Not those of us who are loaded to the gills with Gold...

If they pause today, then raise later, it'll cream the Market. It will be an indication they are truly scared about inflation, and that even they don't believe the cooked numbers. It will tell the Market that more raises can come at any time....

OT: $3.14 here in Rockies, but that's for 85 octane...

HANS - He's saying that the apparent drop in margins was not due to higher expenses on existing product mix, but rather to a greater increase in sales in a low-margin product than the overall sales increase.

Doesn't seem to bad. Maybe he sounds rattled because he's been drinking too much Monster...

HANS CEO (CFO?) not coming across very well. He sounds defensive and a little bit rattled (to me, anyway - I've never heard him before)...

Yeah, duh, I guess I should do that. Next time I will, and report back... :)

C4t - I asked Tulving about the threshold for reporting a purchase to the IRS, and they said there was none. That seems odd to me, because I thought that every time $10k+ in cash changed hands in a single transaction, a report had to be made.

Maybe that's only when a bank is involved.

Anyway, I went ahead and bought a bunch at $629. I'm going to buy a bunch each time the POG drops $10, if it does, and the bunches will get bigger as the price drops further. If it doesn't drop, then I've got anough already anyway...

Thanks. I checked them out, and checked out Tulving, and ended up buying some from Tulving for $629. It looked like Apmex was more like $633 at the same time, but one would really have to have both of them on the phone simultaneously to get a real comparison...

Clearly, the Market agrees with you. It just keeps going up...

Thanks. I was looking at them yesterday. What did you buy, if I may ask?

Sorry, I don't know. I was just responding to Basserdan's post.

That's a 112% profit since you recommended it in 10/2004. Thanks again!

BTW, it's trading at $15.28 in pre-market. It would seem that some people think there'll be another PDG-type situation, with competing bids. I don't think so, and I'll short it if the price stays that high. Your thoughts?

Aw c'mon, it's Sunday. Do you have to remind me of that POS? I've got a bunch, thinking that once they sell off that big secondary the price will rebound...

C4t - thanks. You told me that before, but my long-term memory is not always accessible anymore. Short-term either.

Yes, those prices are indeed lower than Goldmasters. I have no problem with the minimum, other than it's over $10k. Wouldn't that mean they would have to report the sale to the IRS? I will call and ask...

Don't forget the tanker companies like OMM and FRO, or some oil giants like COP.

BTW, the homebuilders won't look "cheap" when the E disappears from their PE's....

Thanks. Looks like they have decided to kill the COT reports, and are just going thru the bureaucratic process of pretending they care about public response.

Would you mind sharing whom you buy Gold from and what you buy?

In the past, I have used http://www.goldmasters.net/
and bought Krugerrands, but wonder if I could be doing better... TIA

SLW is a Doug Casy recommendation, too. I've bought a bunch...

And you're up nearly 20% on NTRI already!! <bg>

Generally agree that he and hsi colleagues are trying to talk the market down. The Fed is not alone in this, though. The BOJ has probably done more, at least in terms of removing liquidity.

Thanks Dan. An interesting situation, and one worth watching. After all, if the big threat to GRZ (Chavez) turns into a partner, that could be the best thing to happen to the company. Not that I have much faith in the Chavistas, but they might decide it's in their best interests to at least appear to be trying to behave as reponsible partners. Given the enormous leverage against the current stock price provided
the gold in the ground, even a mediocre relationship with the new majority owners might not be so bad.

More likely, I suppose, is that this is just the next step in a creeping confiscation...

Hi Dan... Any idea what happened to GRZ at 1:30 today? No news in any of my sources.

I traded in my GRZ for NXG a couple of months ago, but I'm still curious...