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12/26/15

The five most popular Friday OT posts of 2015

And we make it to the end of another year. Other places do look-back reviews of their fave or most popular posts in the year, but as IKN is ashamed of what it publishes* we instead review the music and videos, specifically the Friday OT segment to see which slots of tunes were the most popular, in direct hit terms.

And here are the top five, all of which can be accessed by clicking on the names:








That Jimmy Page semi-interview-semi song was a fave with many of you, not least reader and friend AB who waxed lyrical in a mail way back in January when it came out. Then "Messi is a dog", Spanish with English subtitles, is the only non-music video to make the top five list. It's also wonderful and just the thing for any non-football fan who wonders what all the fuss is about.

Third place comes Paco de Lucia playing a buleria from heaven, the chemistry between him and the cajón player is a marvel, too. Then the runner up is Miss Philippi....ah no, the runner up is the OT from just a couple of weeks ago, Tom Waits hitting your festive chords.

And the winner, the most popular Friday OT of the year, is richly deserved. My own personal musical discovery of the year (but only because I'm slow, he's been around for at least 15 years), I've never heard anything quite like the amazing and deeply beautiful music of Jon Hopkins.


*nah, not really


12/24/15

A Christmas miracle

Christmas is that special time of year when miracles can really happen, the mean-spirited become generous, good will comes to those of true faith and legends abound of animals, such as reindeer and dogs, that can suddenly fly and soar without any apparent means of support.

Completely unconnected to all that, here's the ten day chart of McEwen Mining (MUX):


Ho Ho Ho.


Own Nevsun (NSU.to)? Read this

It's what you're helping to support. Merry Christmas.

"The prosaic truth is that this is just another of the nasty regimes that persist in parts of the world. Eritrea is a one-party state with no elections, has had no functioning civil society since 2001 and, with at least 16 journalists currently behind bars, is ranked bottom of 180 countries assessed in Reporters Without Borders’ press freedom index. The regime sows paranoia and uncertainty, leading to divergent views over how far the limits of free speech can be tested.
"A recent UN inquiry on human rights described extrajudicial killings, torture, arbitrary detentions, enforced disappearances, indefinite military conscription and forced labour. Its report found “a pervasive control system used in absolute arbitrariness to keep the population in a state of permanent anxiety”."

Full report here.

The Beatles are on Spotify

As of today, Christmas Eve 2015. And I reckon that's the best intel you'll get from this blog this week.

Merry Christmas.

12/23/15

News from Banks Island Gold (BOZ.v), Louis James's "biggest personal position"

In three snack-sized parts.

1) Here's what Louis Lobito Little Wolf James, fake geologist and chief rock kicker at Casey Research, said about Banks Island Gold (BOZ.v) in 2014 when he pumped the merry bejeez out of it and got people in at 50c (and here's an extract line or two):
"I want to remind readers that both Doug Casey and I own shares in Banks. Personally, it remains my largest position."

"...I'm reiterating my renewed Buy recommendation. Whatever happens in the near term, these shares are a great buy, whether for a first tranche or a second. I intend to buy more myself—after giving you a chance to do so first."

2) Here's what IKN said about Banks Island Gold (BOZ.v) when your humble scribe eventually took a look at the thing (and here's an extract line):
"Seriously. I mean, seriously, how can anyone in their right mind like a company with a balance sheet like this? Let alone somebody as dangerous to other people as Lobito who recommends it to other people. Especially when those people are a bunch of naive sheeplike followers who require a little expertise in the sector, not tripledumb investment advice?"

"I knew Louis James was stupid about geology. I didn't realize how stupid he was about financials. The above is just plain embarrassing, it's amateur hour level."

3) And here's what BOZ.v said today:

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Dec 23, 2015) - Banks Island Gold Ltd. (TSX VENTURE:BOZ) (the "Company") announces that the Company has canceled the equity financing announced by news release on December 1, 2015. The Company did not receive sufficient interest to be able to close the $3M minimum financing required to support its operations over the coming months.
As a result, the Company has insufficient funds to maintain operations and has received notice of claims from three significant trade creditors for payment of outstanding debt. The mining reclamation bond posted by the Company with the Ministry of Energy and Mines has been confiscated by the Ministry. The Company has provided notice of termination to all of its remaining employees effective December 31, 2015. The Board of the company is currently comprised of Ben Mossman, Jason Nickel, John Anderson and Frederick Sveinson.
The Company is consulting with its legal advisors, and will provide a further update on the Company's status in the coming weeks.

How's that trade doin', Lobito?

Rio Tinto stays on at La Granja

Contrary to rumours that did the rounds in Lima a few weeks ago, yesterday Rio Tinto (RTZ) announced today Gestión revealed that RTZ was renewing its concession for the big La Granja copper project in Cajamarca Peru for another eight years and plans to re-boot its exploration and development of the project in 2016. Here's a photo of the dead wood version of Peru's biz paper Gestión with the news:



And that's very interesting.

Reality bites: Results of the IKN "Ten random predictions for 2015"

On December 29th 2014 we ran our annual "Ten random predictions" post for the year ahead. As we're now all done bar the shouting, it's time to check out how we got on in this edition. Here below come the original calls, the result and the usual polemic slant on scoring for the year (1, 0.5 or zip nada zero per item), And by way of reminder...
  • In 2013 we scored 5.5/10
  • In 2014 we scored 6/10
...so let's see if the improvement continues. First (in small script) you get the prediction as it appeared on December 29th 2014. Then you get the result and a line or three of views'n'news, so starting at the beginning with forecast number one...

1) Gold to trend up gradually, with a rough U$1,400/oz target for some time at the end of the year. For sure with the normal wobbly stuff along the way and I wouldn't bat an eyelid to see it go under U$1,100/oz again at some point or other, but talk of its utter demise (South of 1k) strikes this author as plain silly talk from people who don't get the sector.
Score: 0.5. For sure the $1,400/oz bit was out, but the low end prediction was pretty darned accurate, as we saw the $1.1k breached and $1k hasn't been threatened. So I'll rescue half points on this one.


2) The gold/silver ratio to stay high, by which we mean 1/70 or above. It can spike down briefly under that along the way, but I don't expect it to trend down meaningfully. When they call silver "the poor man's gold", the real message is "the choice that poor people make". Semi-on-topic, I'd definitely hold gold miner stocks over silver miner stocks this year.
Score: 1 point. This one couldn't have been closer to the mark, as a) the GSR stayed high all year and only once spiked under 70X and then only for one day.


3) Uranium will go nowhere again. We're in the high $30s today, it could fluctuate up into a 4-handle, down through to the 2s, but the prediction is to watch it flatline in general terms. Uranium's going the way of the buggy whip, the world has moved on from the fallacy of "near limitless/near free energy" and knows how expensive these things are to decom, the type of cost that's built into projections by serious countries (China an obvious exception to that category). 
Score: 1 point. It didn't see a 2-handle, it saw a 4-handle very briefly, but for the vast majority of the year it simply languished in the mid-$30s per pound, not going anywhere and getting no love.

4) Barrick (ABX) will merge with Newmont (NEM). It's long past fusion date for these two. The sooner the outsized self-important egos on both boards start caring less about themselves and more about their shareholders, the better. 
Score: Zero points. This was my left-field biz call and it would have been an eye-opener if it had happened, but the turgid state of the mining sector put paid to the idea quickly and nobody's even breathed about the idea for at least six months. Nada here, move on.


5) Copper to maintain around U$3/lb average for 2014. This is perhaps the toughest and most important commod market to call in the year ahead. Also (and to push my luck on the prediction) it wouldn't surprise me in the least to see Cu weak in the first part of the year, trending higher in the second part. If it exits between $3.10/lb and $3.20/lb I'd be a happy long.
Score: Zero points. On this one I'm happy to say I saw the reality early and stepped away from major copper stock exposure, but back in December 2014 I was way too optimistic about the world and frankly, 12 months on, the call looks plain silly. And that's not a bad thing, keeps the ego in check.


6) Venezuela's government to be bailed out by China. It's no secret that Venezuela's finances are under severe pressure due to the drop in oil prices, but it's not going to lead to a fall in the government in 2015 (sorry haters, it's the way it is). China wants crude oil and has dollars, Venezuela wants dollars and has crude oil, the two countries get along just fine, the synergies are obvious. The question is how much Venezuela will have to cede for the bailout.
Score: 0.5 points. Indeed Venezuela was tipped for economic death this time last year by the chatter-o-sphere and indeed one of the things it did was get a big bung from China (rumoured to be around U$7Bn) in March which helped them pay the bills. But I'm only going to award myself half marks on this one because even I agree that the political situation in Venezuela is now looking unstable and the Maduro government is under real pressure from all sides.  How 2016 will go for the country is anyone's guess, but there comes a time when the right wing boys who cry wolf are going to be right. It could be next year.


7) It's a difficult call this early in the process, but I'm contractually obliged to make a call on the Argentina presidential election so the forecast is for Daniel Scioli to be the next President of Argentina. Main opponent is Massa, in with a squeak is Macri, outsider Randazzo, the rest are just noise. But it's still a very fluid situation so this one is only tentative. For the record, the Argentina vote slated for October is the biggest single political event in LatAm this year and arguably the most important one in terms of regional repercussion potential for the last five or even ten. It's going to be big, noisy and full of FpV/CFK-hate in your English language press (who'll be rooting for Massa and/or Macri).
Score: Zero points. The shock political result of the year, Mauricio Macri came from a losing position in August, ran a strong campaign (while Scioli's was weak and lacked total support from the hardline Kirchnerists) and came from behind to win in the second round run-off. It's also one I got wrong more than once, because my confidence that Scioli would win it grew as the year went on and I started calling him the very likely winner from August onward. Shows what I know.


8) Argentina to win the Copa America 2015, the equivalent of the European Championships for the continent, held in Chile in June/July this year. If that doesn't turn out right, hosts Chile must be in with a strong chance and I'd place them as clear second faves today. FWIW it's easy to bet against a Brazil that will need a couple of years to re-build after its World Cup disaster (no other word for it). 
Score: 0.5 points. Yeah I know Chile won it, but as they beat Argentina in the final and I picked those two as the candidates, albeit in reverse order, (and I nailed the Brazil call) I'm going to award myself half a point. Because it's my blog, bite me.


9) River Plate to win the Copa Libertadores (for those of you who don't know, that's the LatAm equivalent of the Champion's League trophy). This is the easiest forecast of the year. Vamo lo millo.
Score: 1 point. The most wonderful sporting moment of the year, as simple as that.

10) Argentina to beat Ireland in the Quarter Finals stage of the 2015 Rugby World Cup, held in the UK in October. How about that for a specific forecast? (Also, the All Blacks for the cup).
Score: 1 point. I still can't believe I called this exact result correctly ten months before it happened (and reader NA can't believe it either). What you see above is exactly what went down in the Rugby World Cup and to get that result it wasn't just a case of picking the winner in the game, but being able to predict where each team finished in the group stage so they'd meet in the quarter-final. I rule.


GRAND TOTAL: FIVE AND A HALF OUT OF TEN. That's half a point lower than last year, the same as 2013. So call me consistent and on due consideration I may turn IKN into a sportsbook prediction service blog in 2016, as my sporting forecasts are way better than my stockpicks.

At some point next week I'll post the Ten Random Predictions For 2016, so until then I'll leave you to laugh at the thought of ABX and NEM merging.

The Automatic Earth

On reading the title of this note in Mining dot com, "Study shows 96% of some mining jobs can be automated", reader R writes a mere five words to your humble scribe:

Steve Letwin came to mind.

And makes my day. Thank you, R.


The fun never stops at Minera IRL (IRL.to) (MIRL.L)

Today's NR:

LIMA, PERU--(Marketwired - Dec. 23, 2015) - Minera IRL Limited ("Minera IRL" or the "Company") (AIM:MIRL) (BVLAC:MIRL) Further to the announcement made by the Company on December 16, 2015 regarding the results of the   Company's Extraordinary General Meeting, the Company has been informed that Mr Jorge Luis Ramos Felicies has   resigned as a director of the Company with immediate effect.   The Company will be considering alternative appointments to the Board in due course.

Or as reader JH put it in a mail this morning, "So a freshly elected director resigns, leaving two of the previous directors, both with 60% of the recent vote against them as a majority in the present board."

Let's hope they can accord a suitable replacement soon, eh guys?

PS: Honestly, we all have better things to think about this week than this chunk of news so relax and let the IRL circus flow. Team Hodges thinks it's gained something with this turn of events, IKN's advice is to let those people think exactly what they want to think. In the upside-down world of IRL, good is bad and bad is good. Truth will out in the end, people.

12/22/15

Meat and Dan

In response to yesterday's wonderful SNBC 'toon featured in this post, reader 'Dan' took the time and effort to send this along.

Hi Otto, in response to your SMBC quantum mechanics post, i thought you'd enjoy this. 

I came across it at least 20 years ago and have remember it fondly ever since.   

cheers, Dan

Thanks Dan, wonderful. Now spreading the word further.

Ricardo Martinelli: Lock him up

First Otto Pérez Molina of Guatemala and now Ricardo Martinelli of Panama, throwing ex-Presidents of Central American countries into jail for abuses during their office is getting to become a habit this year. A very good habit.

The plenum of the Supreme Court Monday ordered the provisional detention of former President Ricardo Martinelli in connection with the investigation into illegal surveillance allegedly carried out during his administration (2009-2014). continues here

Starcore (SAM.to): Weird

Weird and slightly disconcerting, as I own a few shares of SAM.to. This from the NR of three minutes ago

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Dec 22, 2015) - Starcore International Mines Ltd. (SAM.TO) (the "Company" or "Starcore") confirms that it is not aware of any reason as to why trading in its common shares has been halted by the Securities & Exchange Commission. The Company is not a reporting issuer in the United States and is up-to-date on all its regulatory filings in Canada. Having issued this clarification, the Company expects trading to resume on the Toronto Stock Exchange.

Does the US SEC make dumbo mistakes and hit wrong buttons? Time will tell.

UPDATE: Yup, looks like an SEC brainfart. SAM.to now trading normally again.

A Tuesday tune: Four Tet; Love Cry

Setting you up for Christmas and getting you in the chill zone, this is simply amazing:



IKN strongly recommends that you get your hands on a high quality version of this track and then stick it through a high quality speaker. And set the speaker on loud.

Gary Biiwii is bullish on precious metals in 2016

And that's not a permabull's call either, Gary Tanashian of Biiwii and NFTRH has been calling bear for quite a while but he's suddenly getting hot and sticky about the sector prospects for the year ahead. Here's his note today and here's a chunk to give you interested enough to go over and read it all:

"...in the summer of 2011, it was obvious that the gold sector was not only due for, but in need of a cleaning. Well folks, that is the good news! We gold bugs have been deep cleaned, buffed, waxed and are just about ready for prime time, hopefully much wiser and more humble than before. The bear market has been a good thing. Period.
 
I could unleash a chart fest showing gold’s long-term support and downside risk, individual gold stocks that are already in bull markets and myriad other things, but I want to keep this article compact and on message. That message is that a huge proportion of the risk (vs. reward) in gold is now in the rear view mirror with four solid years of bear market activity. So we will show some strategic monthly charts instead.

The Twelve Days of Almaden (AMM.to) (AAU)

On December 10th we wrote these words about Almaden Minerals just hours after it had published news of its new PEA for the Ixtaca project:

"The market shrugged its shoulders today, but I thought the news out of Almaden (AMM.to) (AAU) yesterday about its new downsized PEA plan was pretty interesting..." (continues)

It traded and closed at 70c that day (the T for Thursday in this chart below). Here we are 12 days later and...


...which is a very decent little 25.7% pre-commish rally, even though the volumes haven't been much to go by.

Argentina: The challenges for the Ministry of Energy and Mining

Here's a two minute Spanish language video from La Nación today entitled, "The Challenges for the Ministry of Energy and Mining" (well, in fact it's called "Los desafíos para el ministro de Energía y minería" because it's in Spanish, but you get the point).



It's a pretty reasonable overview and to help with your Spanish, the whole script is subtitled. Those of you into the sectors and versed in the tongue of Cervantes should take the opportunity.

Yamana (AUY) (YRI.to) and Brio-X Gold: Scotia got it

Here's the call section of what Tanya Jakusconek wrote last night on the huevo-en-cara news from YRI last night. She's right, of course:

Recommendation
Management had strongly telegraphed that it believed it could complete a monetization of Brio Gold in a timely manner in order to reduce its debt levels. Without the successful sale, we expect debt levels to remain high relative to the group (2016E net debt/EBITDA is 2.5x vs group avg ~1.6x at $1,100/oz gold price). We expect the shares to be weak tomorrow on the news of the suspension.

I like the understatement in that last sentence. It's a bit like "We expect the next Pope to be a Catholic".

UPDATE: Beggaring belief, YRI actually opened higher on this news! That's either reefer madness or it's a sad indictment of all mining management teams; the market is so used to mediocrity from people running these companies that when one of them (this time our pal Peter) makes a strategically dumb move, it just shrugs its shoulders, mutters "normal" under its breath and carries on regardless.

12/21/15

God, why did you make quantum mechanics so weird?

A wonderful SMBC, right here. Add a chuckle to your Christmas week by clicking that link.

Catching up with Yamana (YRI.to) (AUY) and Brio Gold (aka Brio-X Gold)

Here's what IKN wrote about Yamana Gold (AUY) (YRI.to) on November 23rd, the day it announced the Brio Gold spin-off:


Seriously! I'm not joking, it says so right here:

YAMANA GOLD INC. (YRI.TO)(AUY) ("Yamana" or the "Company") hereby announces that its wholly-owned subsidiary Brio Gold Inc. ("Brio Gold") has commenced a private placement of Brio Gold common shares, consisting of a primary offering by Brio Gold and a secondary offering by Yamana. The implied initial post-money valuation of Brio Gold based on the private placement is approximately $369.3 million.
The primary offering as currently planned will fully fund the near-term business plan for Brio Gold with the majority of proceeds expected to (continues here)

And with a secondary, too...

Yes it's true, you gringos really will buy anything, won't you?
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

And here's what YRI just came out with today, December 21:

YAMANA GOLD INC. (YRI.TO)(AUY) ("Yamana" or the "Company") herein announces that in the context of current market conditions and in consideration of recent positive operational developments at its wholly-owned subsidiary Brio Gold Inc. ("Brio Gold"), it has decided to suspend efforts relating to the monetization of Brio Gold. Yamana will continue to hold the Brio Gold assets within the Yamana portfolio of assets and continues here

We eat turkey for Christmas, Marrone eats crow. Though it must be admitted that this humble corner of cyberspace underestimated its audience, as it turns out you gringos won't buy just anything after all. And I can't remember which of my readers mailed in with the name, but they called it "Brio-X" at the time and we like that.

Any further questions?

McEwen Mining (MUX): Hey Otto! Whatever makes you think...

...that Rob McEwen would like to see his company's share price close 2015 at over U$1.00?



Oooh, just a hunch yaknowz...

How to predict the gold price, Doug Casey edition

Follow the bouncing ball, people:

  • December 2012 gold $1,700/oz: "There's never been a better time to buy and own gold."
  • December 2013 gold at $1,220/oz: "Gold's just about at the bottom, so buy now and you'll be okay."
  • December 2014 gold at $1,180/oz: "Gold's just about at the bottom, so buy now and you'll be okay."
  • December 2015 gold at $1,080/oz: "Gold's just about at the bottom, so buy now and you'll be okay."
  • December 2016: "With gold now trading at $1,200/oz my brilliant and perceptive prediction this time last year has made Casey Research subscribers many millions of dollars profit".

Or as PT Barnum put it, "Every crowd has a silver lining".

Chart of the day is...

...gold, dailies:



That is all.

Mailbag on Barrick (ABX)

This is the way I like my reader feedback: Short, sweet and saying nice things:

"...want to wish you yours (sic) all the best in the holidays and tell you just the short piece on ABX in the weekly yesterday justifies my annual sub. Great intel!!!"

Thank you reader TY, appreciated. Auto-toot-toot finished, on with the show.

News from Ollachea

At its always-important end-year meeting yesterday, attended by most of the population of Ollachea and all its main figures and conducted as always in an open and democratic manner (everyone with a view can speak their mind) the President of the Rural Community, Juan Luis Valeriano was ratified in his post for the next calendar year of 2016. 

Don't expect Team Hodges to pass on this news to you.

Minera IRL and power of attorney (from IKN345)

I've been asked to put this small section of yesterday's weekly on the blog. So here it is.

The new board shows its reluctance to change matters
We could go round the houses on this, but to cut to the chase Power of Attorney (POA) was awarded to Jaime Pinto and (IRL Ltd controller) Carlos Yrigoyen by the old board of directors so that Pinto (in particular) could act on behalf of the board.

Sidebar: Power of Attorney (3): A written document in which one person (the principal) appoints another person to act as an agent on his or her behalf, thus conferring authority on the agent to perform certain acts or functions on behalf of the principal.

It gives him the power to do what he wants, when he wants, with the IRL assets. The idea behind the POA was related to the gaining of control of the subsidiary, Minera IRL SA, because the IRL Ltd (Team Hodges) people want to transfer all assets out of the subsidiary and into the mother ship company and from there, they can do what they want with them.

Now that’s fair enough you might say and if you believe the Team Hodges people they were only going to do that to clean up the structure and take the assets away from an overly powerful and quasi-independent subsidiary that was up to no good. However, that argument suddenly unravels when you realize that the new board of directors has not revoked the POA to Jaime Pinto. It also gets a different light when you consider the way Pinto really operates (see below for more on that).

Yes folks, that’s right: Under any normal change of board, the first thing that would happen is that powerful legal devices such as POA would be taken away from an outgoing board member immediately. But in the crazy world of IRL and because of the obstinacy of the two Team Hodges people left on the board of directors, Jones and Fryer, the person that you voted out by a tally of 92% to 8%, Jaime Pinto, still has full control over the assets of Minera IRL Ltd.


12/20/15

The top three most visited IKN posts this week are...

...in reverse order:


Second Place: "Having a difficult day, Jaime?". Don't bother clicking through on this one, a sum total of seven words and nothing there, but it tickled the funnybone of a few of you.

First Place: "Minera IRL (IRL.to) (MIRL.l): The latest round of Jaime Pinto BS" and even though it's all IRL (again), I did like the way the "eat a live dog in public" explanation came out because it gives a decent perspective on the dirty tricks being used by Team Hodges.

The IKN Weekly, out now



IKN345 has just been sent to subscribers. A buzz-saw attack edition.