full-time investing; total portfolio up over 130% in 2009; but 2010 sucks!
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14:03 GBG: Great Basin Gold announces exercise of over-allotment option (1.35 -0.20)
Co announces that BMO Capital Markets and RBC Capital Markets, on behalf of the underwriters, have exercised the underwriters' over-allotment option to purchase an additional 15 mln common shares at a price of C$1.25 per common share and 7.5 mln warrants at a price of C$0.10 per warrant, for gross proceeds to the Company of C$19.5 mln.
08:23 GG Goldcorp 2009 estimates increased and target raised to $38 from $31 at Credit Suisse (34.73)
Credit Suisse raises their GG tgt to $38 from $31 and also increase their 2009 EPS to $0.62 from $0.55 (consensus $0.58), while trimming their 2010 EPS to $0.89 from $0.96 (consensus $0.84). The firm believes the recovery in the multiple is largely the result of GG's production guidance of flat production in 2009 vs. 2008, appearing a better alternative in light of ABX's subsequent production guidance issued on February 20th of negative to flat production growth in 2009 vs. 2008.
OT: We digress; turning 69 w/ the Speaker?
Omigawd, erase that image quick ... please ...
regardless of political or other persuasion ...
wretched image ... out out damn image ...
12:17 IBM (wouldn't expect this to help the mkt averages):
IBM preparing for US layoffs in services unit, according to sources - WSJ (98.40 +0.10)
WSJ reports the co is expected to inform a large number of U.S. employees in its global-business services unit that their jobs are being eliminated, with the work of many of them being transferred to IBM employees in India, according to people familiar with the situation. It couldn't be determined how many people are losing their jobs in the IBM action. IBM typically avoids public disclosure of layoffs, and a spokesman declined comment on the plan. IBM managers have been receiving training from human-resources specialists on handling the layoffs, according to one manager involved in the process.
Are you suggesting Wade take his balls off the track when he feels the train coming?
Better to manage risk and take profits quickly in volatile times rather than court catastrophe by treating hope like a technical indicator.
OT: By the way, the image below takes awhile to download, but it makes a great computer screen background (stretch mode).
EGY strikes out on North Sea well, losing $8.2million
4:06PM Vaalco Energy announces the consortium responsible for drilling a gas prospect on Block 48/25c in the British North Sea has elected to abandon the well (EGY) 5.52 -0.36 : Co announces the consortium responsible for drilling a gas prospect on Block 48/25c in the British North Sea has elected to abandon the well. As previously announced, VAALCO had a 25% interest in the exploration well, which was an offset to a former Shell gas discovery made in 1987. The exploration well was drilled to a total depth of 7,910 feet. The consortium's decision follows analysis of core samples and the electric log. A substantial gas column was present but with low permeability and porosity. The gas/water contact was observed higher than expected thereby decreasing the size of the potential reservoir. While it is believed that there are approximately 25 bcf in place on the jointly held acreage in block 48/25c, the consortium deemed this to be non-commercial and is in the process of abandoning the well. VAALCO expects to incur approximately $8.2 million of expenses in the first half of 2009 related to its interest in the North Sea well.
Analogy: 3 bulls in a china shop...
07:54 Fed's Evans says US 1Q GDP to show "quite a severe contraction" - DJ
09:03 Credit Suisse downgrades AngloGold Ashanti and Gold Fields to Underperform
Credit Suisse downgrades AngloGold Ashanti (AU) and Gold Fields (GFI) to Underperform from Outperform saying they believe that the gold price will likely follow seasonal trends with price highs at year-end and the beginning of the new year. Between these periods they observe that the gold price generally trends sideways and upwards. Given that gold equities react to a significant extent to fluctuations in the gold price as well as market sentiment they expect gold equities to have a limited upside a year out from now following the seasonal trend described above. The firm maintains their long-standing view that the supply-and-demand fundamentals will remain intact for a long-term upswing in the gold price. The firm notes Gold Fields, AngloGold and Harmony have increased by 30%, 29% and 14% respectively since the beginning of the year.
16:07 ATPG
ATP Oil & Gas was the high bidder on Green Canyon Block 344 (4.33 +0.80)
Co announces that it was the apparent high bidder on Green Canyon Block 344 upon which ATP bid at the Central Gulf of Mexico Offshore Lease Sale 208 held on March 18. Green Canyon Block 344 is located in ~3,244' of water and in close proximity to ATP's Clipper development (Green Canyon Blocks 299/300). The block has strategic value for the creation of a deepwater hub in the Green Canyon area where ATP serves as operator with a controlling working interest.
New products sound great, but the unknown is fixed cost with building and shipping inventory to Walmart. I just assume Walmart doesn't necessarily pay dollars up front for all that product to be put on shelves. May be wrong, but Walmart probably doesn't pay for initial product to stock the shelves. It's more likely they pay DAAT when product leaves the store in a shopping cart.
'peeker (still holding just a few thousand DAAT from long ago and well over current price)
Gold has spiked around ~$35, in electronic trade, erasing earlier losses as the dollar falls following the FOMC decision; currently up $12.40 to $929.40
DOE Inventory Data: Gasoline shows large build vs. expectations for a draw
Wed Mar 18 2009 10:30:25 GMT-0400 (Eastern Daylight Time) ET
Dept of Energy reports that crude oil inventories had a build of 1942K (consensus is a build of 1500K); gasoline inventories had a build of 3195K (consensus is a draw of 1500K); distillate inventories had a build of 112K (consensus is a build of 1000K).
Summary of Weekly Petroleum Data for the Week Ending March 13
Wed Mar 18 2009 10:32:41 GMT-0400 (Eastern Daylight Time) ET
Production: U.S. crude oil refinery inputs averaged nearly 14.2 mln bpd during the week ending March 13, up 64 thousand bpd from the previous week's avg. Refineries operated at 82.1% of their operable capacity last week. Gasoline production rose last week, averaging about 8.9 mln bpd. Distillate fuel production decreased last week, averaging about 4.1 mln bpd... Imports: U.S. crude oil imports averaged nearly 9.2 mln bpd last week, up 59 thousand bpd from the previous week. Over the last four weeks, crude oil imports have averaged 9.0 mln bpd, 571 thousand bpd below the same four-week period last yr. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 1.1 mln bpd. Distillate fuel imports averaged 103 thousand bpd last week... Inventory: At 353.3 mln barrels, U.S. crude oil inventories are above the upper limit of the avg range for this time of yr. Total motor gasoline inventories increased by 3.2 mln barrels last week, and are in the upper half of the avg range. Finished gasoline inventories fell last week while gasoline blending components inventories rose during this same time. Distillate fuel inventories increased by 0.1 mln barrels, and are above the upper limit of the avg range for this time of yr. Propane/propylene inventories decreased last week by 0.6 mln barrels and are above the upper limit of the avg range. Total commercial petroleum inventories increased by 3.1 mln barrels last week and are above the upper limit of avg range for this time of yr... Demand: Distillate fuel demand has averaged 3.8 mln bpd over the last four weeks, down by 9.3% from the same period last yr. Jet fuel demand is 6.4% lower over the last four weeks compared to the same four-week period last yr.
EGY: Down today on small qtrly loss:
Excerpt:
VAALCO reported a net loss of $7.5 million or $0.13 per diluted share for the fourth quarter of 2008 compared to net income of $2.0 million or $0.03 per diluted share for the comparable period in 2007. Fourth quarter 2008 revenues were $16.5 million compared to $37.0 million in the fourth quarter of 2007. The 2008 fourth quarter results reflect the overall decline in crude oil prices from the year-ago quarter, which resulted in lower average selling prices for the Company's product, as well as an increase in production and exploration costs as VAALCO ramped up its drilling program.
During the fourth quarter of 2008, VAALCO sold 399,000 net barrels of crude oil equivalent at an average price of $41.29 per barrel compared to 425,000 net barrels of crude oil equivalent at an average price of $86.92 per barrel in the fourth quarter of 2007. Operating loss was $0.1 million in the fourth quarter of 2008 compared to operating income of $17.4 million in the fourth quarter of 2007.
AGM: Condolences to you and the other VMCers who got clobbered afterhours by their massive derivative losses. Kudos to BobWins who has been clearly stating that particular risk for the last 2+ months.
Increased values in current qtr for their derivatives should help their next earnings report, but I'd use the 3 day rule at this point, that is, wait and see where it settles out after the bad news.
Bottom line: The bad news was much worse than expected:
... fourth quarter net loss of $61.1 million, or $6.03 per diluted common share for the three months ended December 31, 2008, and a full year 2008 net loss to common stockholders of $154.1 million or $15.40 per diluted common share.
AGM: sold my minor position today because:
1. I don't want earnings or PR comments to push it down, AND
2. It had a nice pop the other day but has not been getting enough buying volume to maintain a gain lately.
3. I'm psychologically bruised by performance of gold stocks lately and don't want to risk the small gain I have on AGM.
'peeker
Gold getting tarnished today; breaking below $900 hurts bigtime.
Dow up 5%, GORO and AGT down 10%.
NUTS!!!
'peeker
natural-ly
OT: AN IRISH BLONDE
An attractive blonde from Cork , Ireland arrived at the casino. She seemed a little intoxicated and bet twenty-thousand Euros on a single roll of the dice.
She said, 'I hope you don't mind, but I feel much luckier when I'm completely nude'.
With that, she stripped from the neck down, rolled the dice and with an Irish brogue yelled, 'Come on, baby, Mama needs new clothes!'
As the dice came to a stop, she jumped up and down and squealed...'YES! YES! I WON, I WON!'
She hugged each of the dealers and then picked up her winnings and her clothes and quickly departed.
The dealers stared at each other dumbfounded.
Finally, one of them asked, 'What did she roll?'
The other answered, 'I don't know - I thought you were watching.'
MORAL OF THE STORY ???
Not all Irish are drunks,
not all blondes are dumb,
but all men...are men.
Oil heading to $50 with OPEC cutting supply:
http://www.bloomberg.com/apps/news?pid=20602013&sid=aP2gWI8POYac&refer=commodity_futures
15:56 Potash outlook (posted for holders of KCLOF):
IPI: Intrepid Potash Earnings Preview (17.04 0.69)
IPI is due out with Q4 earnings after the close today with a conference call set for 11:00am ET tomorrow... Current consensus for IPI is for Q4 EPS of $0.30 on revs of $77.7 mln; FY08 EPS of $1.64 on revs of $398 mln... Guidance: The company has never given financial guidance since its IPO last April. On Dec 18, IPI said it expects sales levels for Q4 to be less than half of Q3 levels because farmer purchase that typically occur in Q4 were delayed or reduce to early 2009... Near-term catalysts that have been moving the stocks (Agrium (AGU), CF Industries (CF), Intrepid Potash (IPI), Mosaic (MOS), Potash (POT), Terra Industries (TRA) and Terra Nitrogen (TNH)) have been the build-up of expensive product on the retail level, U.S. spring planting season and most recently, yesterday's potash price cut of 25% for Brazil exports by Uralkali. Additionally, industry consolidation attempts have been heating up this year. On January 16, CF bid for TRA, then on February 25, AGU bid for CF. Finally, on February 27, there were rumors that Cargill, who owns ~64% of MOS, will buyout the remaining shares of MOS for $58-60. At this point, it is known that demand in early 2009 will be a little slow as the second half of the year is expected to outperform the first half. We continue to believe that nitrogen sales will be higher than expected in Q1 and that TRA and CF will outperform the group in the near-term. We like the whole group, but are reevaluating the effects of the significant price cut from Uralkali yesterday... IPI has a short history as the IPO was issued in April of 2008. Since then, the co beat EPS consensus by $0.03 in Q1, beat by $0.04 in Q2, but missed by $0.07 in the most recent quarter (Q3). The current quarter provides more uncertainty following the reduction in sales by ~50% on December 18. The updated guidance we believe is negative on the surface, but not as bad as investors may think. We knew lowers sales were coming at the end of last year given the late fall harvest as well as the reluctance of farmers to sell grain to elevators due to notably lower prices. On the call tomorrow, listen for updated on potential M&A activity, Q1 volume expectations and the effects of Uralkali price cuts yesterday... Secondary plays: MOS, AGU, CF, TNH, POT, TRA...
OT: (re: browsers) I also like Google's Chrome browser, which saves tabs open for next time you want to bring the browser up. One feature I like about it is that even if one tab freezes, the others stay up and running. It's easy to use and very UNcluttered compared to other browsers.
'peeker
OT: GEORGE CARLIN (god rest his funny soul) just popped his head up out of his grave and smiled ... you used one of his favorite words ...
GORO: Permits are not holding them up; they are supposedly working closely with local officials, even to the point of getting permission to remove overburden for the pit mine, building the tailings pit, pouring footers, building housing for workers, etc.
At this point they still have most equipment in a staging warehouse (on US side of the border). Last time I heard they needed to wait some prescribed amount of time to allow equipment footers to cure before installing all that expensive mining and mill equipment. They have not shared a detailed operational plan with schedule. If anyone can cajole them into providing details of their plan, that would really help us understand the timeline for operations and profitability.
The delay in the permit gives GORO a way of deflecting criticism for not having everything arranged with contractors to operate the mine and mill once fully constructed.
They've taken much longer than they've forecast to complete construction (and lost some credibility as a result, at least in my book).
Meanwhile, being VERY astute business people, they've arranged equity buyin by Hothschild (which has permission to buy up to 40% of GORO within 2 year agreement period, and could buy even more on the open market after that (even to the point of becoming majority shareholder if they want to take over all decisionmaking).
While GORO is moving forward toward becoming operational, mgt appears to be focused already on exit strategy, that is, cashing out at a huge profit and moving on to another opportunity in about 2-3 more years, if not before. They've done it before, they are doing it with GORO, and they will do it again.
That's my longterm view. I expect GORO to be very profitable in a year's time with a much-increased stock price ($10>GOROprice>$20). I also expect them to be majority-owned by Hothschild eventually.
'peeker
10:51 Leuthold Says Stocks Will Surge, Depression Avoided --
Bloomberg.com reports that Steve Leuthold, whose Grizzly Short Fund returned 74 percent last year betting against U.S. stocks, said now is the time to buy equities because investors are too fearful about the economy. "These comparisons people make with the Great Depression are totally out of touch with reality, and pretty stupid," he told Bloomberg Television in an interview today. "We've been in much worse, much more panicked and more scary situations in the U.S"... He predicted the Standard & Poor's 500 Index will surge to at least 1,000 in 2009, representing a gain of 44 percent from yesterday's 12-year low of 696.33.
OT: That's what you get for using that ridiculous Don Ameche impression.
GORO recovery complete; now even for the day; volume slightly above average, so could foreshadow good things on the way. Has anyone spoken to mgt in the last week or so about permit, plans to set up equip on footers, hiring of contract workers to start the mining ops (I don't think they've done that).
'peeker (just feeling curious and optimistic that good news may be coming soon)
09:25 BA owes ICOG some dough
ICO Global Comm says Superior Court has denied nearly all of Boeing's post-trial motions (0.25)
Co announces that the Los Angeles Superior Court overseeing its litigation against The Boeing Company (BA) and its satellite subsidiary has denied nearly all of BA's post-trial motions. As a result of the rulings, the judgment previously entered on the jury's compensatory and punitive damages verdicts against both The Boeing Company and its satellite subsidiary is now final. The final judgment amount is $603,227,358. (In pre-mkt trade, ICOG is trading at $0.59)
AGT presentation for PDAC is at:
http://apollogold.com/htmlpage/presentations/2009_PDAC_Apollo.pdf
Bobwins,
I forwarded your comment about cost/oz and diluted shares to the author. I left out the cheezy dweeb comment.
ST
AGT report: I got a copy as well. Interesting report, but on "take it with a grain of salt" downside, he also had lots of nice things to say about PZG (separate report).
Actually it was a relatively comprehensive overview of Apollo Gold, including mgt, properties, details about price of gold and hedging approach, and prospects for good cashflow in future.
(Missing were candid comments about how stupid they were to award so many warrants to their recent funding partners.)
AGM: ... and given the great uncertainty about content of AGM earnings report (probable good op earnings, probable moderate writedowns, unknown outlook commentary), you can manage your risk by simply selling all your AGM before earnings come out.
R'59, has AGM price weakness today exposed a small chink in your armor? In other words, the pattern appears to have changed a little today as price action for all "financials" is in question again today vs. strong financials uptrend of the last two weeks, excluding AGM).
'peeker (oops, bought some at 3.61 and waiting for a return to 3.80 in next few days, assuming another "event" doesn't take the whole financials group lower ... and lower ... and lower.)
Yes, AGM has been constrained. If you look at the daily chart, you'll see it has been trading in a narrowing channel since 11/26/08. That "flag" is saying it should breakout one way or the other eventually.... and it probably is waiting for earnings to give the breakout signal.
JC=lightningroundclown
JC (not Jesus Christ, the other one) was chatting about gold tonite and suggesting it goes lower. Regardless of his opinion, IMHO, it may go lower as a follow-on to Bernanke's calming speech today, which gave financials (and overall mkt) a nice lift. If the followthru takes the market higher tomorrow and $ continues higher, gold does probably drift lower for awhile.
It's probably worth looking at GLD technicals to see what RSI, SMAs, and other metrics may indicate about the PM group.
Looking at the crude Yahoo chart it looks like RSI is in the 70s, price is about 3% above 20day SMA and near the upper Bollinger band, so technicals indicate it is moderately overbought. Still GLD appears to be in a solid uptrend for the last 4 months, so if it bounces off the 20day SMA, the little correction we've been living (via nasty SMC/GBG/AGT/GORO drops) may soon be over.
Of course when technicals are not heavily weighted one way or the other, we are back to our fundamentals on particular stocks (vs. TA on an index) and our fear-greed optimism-pessimism apparatus, that is, mental coinflipping.
Bottom line: Good luck PM Jrs, but remember to take some money off the table instead of doubling down til everything looks like TRGD.
Sal U Tations
('peeker)
GBG: Selling on the news of Public Offering (like you said, no price given, so it makes better to buy in PO w/ warrant, vs. buyihg today w/o a warrant).
AGT: Selling on news of completed Private Placement (share prices to banks are very generous; creates potential long-term overhang on stock price).
GORO: Just drifting down on something, perhaps just due to weakness in overall mkt, including the gold miners (with gold price/oz inhibited short-term by $1000/oz psych barrier).
SMC: Just acting sucky (stuck in an arbitrage channel governed by CA$/$US rates and 1.28 BTO.to to be paid per CSM.to share.
These "horsemen" appear somewhat disoriented on this day, as they seem to have limited control over which way the horse goes for now.
JMHOs,
'peeker
GORO: Are you saying GORO will have more "financing" news? I'd rather they have permit news. I called early this past week, and it appears they are still not trucking their equipment in for setup yet (though they have a company hired to do all the trucking/install when GORO gives the green light. The footers have been poured, but some require more curing time before they start installing all the machinery. My interpretation was that it will take 3-4 mo to set everything up and about 1-2 mo to shake things down (startup and tune their operations/processes with the existing low-grade stuff). Whether they start trucking/installing before they get the last (open pit mining) permit remains to be seen.
'peeker
Cramer is not a "best of breed" real estate investment counselor. He's a marketing showhorse for insecure stock investors. CNBC personalities need to focus on reporting the news instead of looking for ways to make the news for personal gain. Cramer, as a professional loudmouth CNBC commentator, cannot give totally unbiased advice IMHO, nor does he have any real estate expertise to stand on.
The standard "short sale" that occurs today facilitates sale at a discounted price (banks take the hit on the difference between mortgage balance and what the home can be sold for; seller moves out but has no foreclosure on their record). Short sales keep banks from having to pay legal costs needed to do a foreclosure sale at the courthouse AND avoids maintenance/repair costs while waiting for REO sale (bank hires realtor to market/sell the property).
The current problem is that there are not enough buyers willing to buy the homes because the prices have not fallen enough. Longtime real estate investors are among the victims of the credit crisis and rapidly falling house prices, so they are strapped with multiple rental homes for the foreseeable future. Govt needs to encourage new buyers to come in and buy the homes as investments/rentals (use tax breaks and little-downpayment loans, like VA loans today).
After government decides which options they are going to support, believe me... companies and individuals will start planning to take advantage of the buying opportunities as they present themselves.
Real Estate investing is somewhat similar to stock investing in that the lack of transparency is currently keeping people away. Once the programs are established, real estate investment associations will help educate real estate investors on how to put money to work with a manageable amount of risk.
Another similarity ... when it's clear the real estate in an area is bottoming (like stock prices), the buyers will come in. Real Estate investors (like stock investors) are waiting for clear signs that the market is bottoming before committing capital.
While we remain in a downward slide in the world economy, credit systems, stock prices and realestate values, most investors are waiting on the sidelines for clear evidence that the recession/depression and stock/realestate markets are really bottoming. When the bottom is in (maybe 6mo or 6yrs from now), stock and real estate investors will resume buying as slow growth begins showing up in the economy/stockprices/realestateprices.
Meanwhile, rising unemployment adds to the problem. Places like Detroit with growing unemployment rates are suffering severe losses of real estate values. The hard-working people there who have lost their jobs are really up the creek without a paddle. They cannot sell their homes for enough to pay off the mortgage, so they have had to let them be foreclosed and their credit records wrecked by it (or sold via short sale to minimize damage to their credit rating). Many unemployed homeowners are stuck in Detroit unable to sell their homes so they can move to a better location (doesn't matter if it's hot or cold there, if there are jobs to be had, it's a better location).
Being optimistic, wait til the government plans shake out and the markets bottom, then determine where the opportunities will be. Geitner wants investors to invest in some of those CDOs, and real estate investors will be trying to figure out when to start buying homes again for prices that allow a renter to cover the mortgage payment (and the real estate investor will be looking for some degree of home value appreciation over time).
So we've always known life is complicated; if it's too complicated to invest in (VMC) stocks or real estate, just buy gold (like all us confused VMC Junior Miners have been doing).
Celebration: I got 4 new 22" LCD monitors this week, so my office looks and feels better even though the portfolio went down again this week.
'peeker
PS> ... but don't let all the world's stark reality keep you from having a great weekend.
Stop peeing on my shoe and telling me it's raining.