Tekoa Da Silva recently joined up with Sprott Global Resources. Now he’s looking at undervalued mining stocks and he’s finding a number of good ones out there.
While the broad stock market has heated up and will probably remain that way, the mining sector is still a value play. Where else can you find a company selling for less than its cash and short term investments?
He believes that the next move in resource stocks is about to play out.
We touched base with Mark Skousen to get an after action report on this year’s Freedomfest.
We had great fun there. If you’re a libertarian then you really need to attend. The only negative, if there is one, is that there are so many sessions going on at once, that it’s hard to keep track of it all. Perhaps an App would help.
For us PJ O’Rourke was one of the highlights this year.
35 percent of the US population is being hounded by collectors. Not surprising in a country that’s the largest debtor nation in history, it only figures that the population would be broke too. The next bubble is auto credit, with nearly $1 trillion in car loans outstanding. But have no fear, if you default on your loan or lease, they’ll just immobilize your car or track it down by GPS and repo it. Isn’t technology a wonderful thing? We also talk about a number of important current stories on FSN.
The U.S. lacks the resources to adequately respond to external shocks like a foreign relations crisis or climate change, former Federal Reserve Chair Alan Greenspan said Wednesday.
In an appearance on “In The Loop With Betty Liu,” Greenspan warned that the economy has almost no room to maneuver if faced with a security threat:
We are running out of buffer in the economy. We don’t have the capability should, for example, we run into a major conflict in the Middle East or elsewhere where it requires a major increase in our defense budget. Our defense budget is heading in a direction where in a couple, two or three years it will be at the lowest level relative to GDP since before World War II. We don’t have the physical resources to respond.
Meanwhile, the government is going to have difficulty raising revenues to adequately confront longer-term threats like global warming:
The equity market is a overvalued. Stocks are in a bubble that has been blown by the Fed’s artificially low interest rates. The price-to-earnings ratio has left all semblance of sanity behind. The bubble is going to pop and it won’t be pretty when it does.
Stop me if you’ve heard all this before. If you’re a subscriber to the International Forecaster then you doubtless have heard it before. Numerous times. For the last several years. This is because Bob Chapman had the foresight and experience to see the writing on the wall when it came to the post-Lehman bailout and the Fed’s emergency lending facilities and quantitative easing.
[...] As he told me in any number of our conversations in the post-Lehman era, the bankers and the politicians in their back pocket were keeping everything moving sideways. They could do it for some time, maybe several years, but not forever. Eventually the piper would have to be paid. And so it should be no surprise to see where we are: the S&P and DJIA at record highs, P/E ratios that make no sense, consumer debt levels (and delinquency rates) on the ascendant once again, 10 year treasuries at 2.46% and a lot of advisors telling us that we’re in for a 20 year bull run (yes, John Stephenson actually said this at the beginning of the year).
WASHINGTON (MarketWatch) — It’d be tempting to think that the days of subprime loans fueling the economy were a product of the era of the aged or departed Ace Greenberg, Alan Greenspan and Angelo Mozilo.
Except when you break down the growth in GDP, it’s clear that car and light truck purchases played a major role. And subprime loans, in turn, are financing those transactions.
In the second quarter, motor vehicle and parts spending grew an annual 17.5%. Put another way, cars made up 3.7% of all consumer spending, the highest rate since the first quarter of 2008.
Subprime loans make up about a third of new car-sales and two-thirds of used cars, according to data from Experian Automotive, at the end of last year. The New York Times, in a story about the subprime loan sector , pointed out that growth has climbed more than 130% in the five years since the crisis.
Like so many other things in popular American culture, this quaint notion of a “middle class” in the U.S. is at this point nothing more than a myth; a rapidly fading fantasy from a bygone era. As myself and many others have noted for quite some time, the decimation of the middle class began long ago. It really got started in the early 1970?s after Nixon defaulted on the gold standard and financialization began to take over the American economy. Median real wages haven’t increased since that time and the rest is history.
Although the evolutionary process toward oligarchy began long ago, its finishing touches have been applied in recent years. This has been easily achieved by the Federal Reserve and U.S. government’s response to the financial crisis, which was and continues to be characterized by an intentional funneling of all the nation’s wealth into the hands of their patrons; the 0.01%. As the chart below demonstrates clearly (and as I highlighted in the post: Where Does the Real Problem Reside? Two Charts Showing the 0.01% vs. the 1%), it is the tiny oligarch class that is reaping all of the benefits.
Ralph Aldis, portfolio manager with U.S. Global Investors, is a well-respected mining analyst. His detailed knowledge of the companies in the U.S. Global Investors Gold and Precious Metals Fund and across the entire precious metals space has taken years of meticulous work and dedication to his craft. Aldis urges investors not to get married to their stocks, but in this interview with The Gold Report, he discusses lots of names that are good for a fling right now.
The Gold Report: U.S. Global Investors recently published a report outlining the two trades that drive gold demand: fear and love. Which one is more powerful right now?
Ralph Aldis: The love trade is the foundation of owning gold stocks and gold because 70–80% of gold goes into jewelry. On the margin, the fear trade is driven more by the headline risks that we’ve seen in the Ukraine and the Middle East, or by inflation spikes. That’s what drives people to take action.
One of the most highly respected hedge fund managers in the world, billionaire Paul Singer, has just issued a deeply troubling warning that an acceleration in inflation will trigger major social unrest in the United States. Of course this inflation would also blow the lid off the gold market. There is also a fascinating chart from top Citi analyst Tom Fitzpatrick included in this piece.
The following is from Art Cashin’s note today: More There Than Noticed – Fabled hedge fund manager, Paul Singer’s latest Elliot Management Corp letter is getting picked up by the press and Wall Street alike. The primary citation in most cases is his concern about a massive CME from the sun that might change the Earth drastically.
Today’s stronger than expected Q2 GDP number ( 4% compared to expectations of 3%) has ramped up selling in the longer dated section of the curve. The long bond is down over a full point as I type these comments. The Dollar is also benefitting, particularly against the Yen today, as forex traders are buying it and selling the rest of the majors. Talk has now shifted ( at least for today) firmly in favor of higher interest rates coming to the US before any of the other industrialized nations.
Take a look at the daily chart of the US Dollar ( USDX). Note that the greenback has run right into the zone of heavy chart resistance pictured on the chart. That resistance zone is a function of a downside gap made all the way back in September of last year.
French President Francois Hollande’s government may have made a housing slump worse, pushing the construction market to its lowest in more than 15 years.
Housing starts fell 19 percent in the second quarter from a year earlier, and permits — a gauge of future construction — dropped 13 percent, the French Housing Ministry said yesterday.
The rout stems from a law this year that seeks to make housing more affordable by capping rents in expensive neighborhoods. To protect home buyers, the law also boosted the number of documents that must be provided by sellers, leading to a decline in home sales and longer transaction times. While the government is now adjusting the rules, the damage is done, threatening France’s anemic recovery that’s already lagging behind those of the U.K. and Germany.
Back in December 2013, when everyone was expecting a 3% GDP print for Q1, we did a simple analysis concluding that “Inventory Hoarding Accounts For Nearly 60% Of GDP Increase In Past Year.” We stated that this “hollow growth”, which is merely producers pulling demand from the future courtesy of cheap credit and assuming the inventory will be sold off in ordinary course of business without bottom-line slamming liquidations or dumping, and which further assumes a healthy US consumer and global economy, is a flashing red flag for the future of US economic growth. In fact, we were one of the very few who warned that Q1 GDP would be a disaster: “The problem with inventory hoarding, however, is that at some point it will have to be “unhoarded.” Which is why expect many downward revisions to future GDP as this inventory overhang has to be destocked.“
The 2014 Social Security report to Congress is finally out (Link). The report was released four-months later than permitted by law; this is the sixth year in a row that the Report has been late. The word ‘sloppy’ comes to mind; Treasury Secretary Lew gets a ‘D’ for timeliness.
I’m blown out by this year’s report! It was just 13 days ago that the Congressional Budget Office released its numbers for SS (Link). There are very significant variances on key metrics for SS. The inescapable conclusion comparing the two reports is that either: (1) CBO is misrepresenting numbers with some kind of political agenda in mind, or (2) SS is sand bagging its numbers for reasons that have to be political as well.
For his Internet radio program, “Turning Hard Times into Good Times,” newsletter writer Jay Taylor yesterday interviewed your secretary/treasurer and mining executive and financial consultant and market analyst David Jensen about gold and silver price suppression. The interview with your secretary/treasurer is 21 minutes long and the interview with Jensen is 28 minutes long. They can be heard at Taylor’s Internet site here:
There is an ongoing debate as to whether or not there is manipulation in the gold and silver markets. Further, there is also a debate as to whether or not ALL markets are manipulated. Why is this important? Does it matter one way or the other? I will concentrate on the “why” it is important for gold and silver, I imagine that you can discern “why” it would be important if all markets were manipulated.
I’m not really sure where to start but I guess the first and most obvious place would be because “this is America.” “America” for a lack of better term “stood (notice past tense) for truth, justice, and free/fair markets.” This along with our rule of law, stable political system and strong military was the reason that foreigners preferred to invest here rather than anywhere else. It “was” always perceived that investors could get a fair shake in the U.S. and not have to worry about political coups, fraud or graft, shady financial reporting or outright financial theft. We were the “beacon” of truth and light when it came to investing.
The devices came from manufacturers of TVs, webcams, home thermostats, remote power outlets, sprinkler controllers, hubs for controlling multiple devices, door locks, home alarms, scales and garage door openers.
All of the devices included remote smartphone applications which were used to control them.
It was found that 90 per cent of the devices collected personal information, 70 per cent transmitted that data on an unencrypted network and 60 per cent had insecure user interfaces. Eight out of ten failed to require a strong enough password.
Good luck folks. As soon as you start bringing this crap into your home you are giving criminals access to the most-intimate portions of your life and worse, you may be putting your safety at risk – as I recently warned.
Equity bulls should be exuberant. The last time Alan Greenspan warned of exuberance and potential for a correction, stocks soared for a few more years. While Yellen’s stock-picking skills have been questioned in recent days, Greenspan has once again weighed in:
*GREENSPAN SAYS ‘KEY QUESTION’ IS WHETHER U.S. FACES FALSE DAWN
*GREENSPAN PREDICTS AT SOME POINT EQUITIES TO HAVE CORRECTION
Although Greenspan declined to second-guess the Fed, he sees a problem moving toward “normalized” policy for his descendants.
Speaking on Bloomberg TV, Greenspan has lots to say…
London (Mineweb) – The one sided drivel which passes for objective news reporting in the West never ceases to amaze me. On Ukraine, and in particular on the shooting down of Malaysian airlines flight MH17, the western media seem to promote one agenda, and one agenda only, without any recognition at all that there might be an alternative argument viewed from the ‘other side’. Now whether it is proven that the anti-Russian rhetoric thus encompassed is correct or not surely a wholly impartial news organisation should at least recognise that there could perhaps be another side to the story. The whole affair smacks of the Weapons of Mass Destruction accusations against Iraq – the pretext which led to the Iraq War and which spawned so much killing of members of the armed forces, local police and huge numbers of civilians and has indirectly led to the far more worrying – to the West – takeover of large swathes of Iraq and Syria by ISIS. Perhaps the West should learn not interfere in other countries, however despicable their regimes may appear to be, without understanding the unintended consequences of so doing which are often – indeed usually it would seem – far worse for the local populace than the existing status quo.
I was talking with one of my colleagues the other day, and he raised a very interesting question, one that deserves consideration by anyone worried about their digital privacy. He read an article that championed the idea that the more steps one took to protect their privacy by using anonymous Web-browsing tools like Tor, the more likely that individual would be targeted for “surveillance” by the NSA.
The article went on to say the NSA closely watched user accounts searching for information on non-Windows operating systems like Tails or Linux. The authors of the article suggest the NSA presumes anyone interested in using technology to protect their privacy is a potential threat to national security. On the other hand, those taking no steps to demonstrate privacy concerns (as evidenced by an interest in available tools) are not.
If the back-and-forth action in the markets has you banging your head against the wall these days, maybe you’re concentrating on the wrong stocks…
While the market churns near its highs and investors continue to fret over the makings of a possible correction, Asian stocks listed on U.S. exchanges are catching fire. Japanese markets are at 6-month highs. And Nasdaq data show a basket of Asian ADRs advancing to new 52-week highs.
Today, I want you to concentrate on China. Specifically, those much-maligned Chinese stocks that trade (sometimes erratically) here in the U.S. I see signs that the market is building up for a new speculative frenzy for beaten-down Chinese names. If you pay attention and hop onboard at the right time, you have the chance to score more than one massive trade before the end of summer.
The price index for gross domestic purchases, which measures prices paid by U.S. residents, increased 1.9 percent in the second quarter, compared with an increase of 1.4 percent in the first. Excluding food and energy prices, the price index for gross domestic purchases increased 1.7 percent, compared with an increase of 1.3 percent.
Real personal consumption expenditures increased 2.5 percent in the second quarter, compared with an increase of 1.2 percent in the first. Durable goods increased 14.0 percent, compared with an increase of 3.2 percent. Nondurable goods increased 2.5 percent; it was unchanged in the first quarter. Services increased 0.7 percent in the second quarter, compared with an increase of 1.3 percent in the first.
In other words the increase was largely durable goods — if you believe it. I’m not at all sure I do.
“It’s a troubling continuation/expansion of trade as a geopolitical tool,” warns one Washington-based consulting firm as Russia prepares to unleash retaliatory actions to US and European sanctions. As Bloomberg reports, Russia said yesterday it may ban imports of chicken from the U.S. and fruit from Europe and is investigating McDonald’s cheese for safety. In addition, a Russian lawmaker has drafted legislation that might result in U.S. accounting firms being barred from doing business in his country. All of this is odd given Jack “trust me” Lew’s reassurance that Russian sanctions would have no impact on the US economy. Russia’s response, US will feel ‘tangible losses’ from ‘destructive, myopic’ sanctions.
by Steve Saville, The Speculative Investor Gold Seek
“Lenin is said to have declared that the best way to destroy the capitalist system was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the existing distribution of wealth*. Those to whom the system brings windfalls, beyond their deserts and even beyond their expectations or desires, become ‘profiteers’, who are the object of the hatred of the bourgeoisie, whom the inflationism has impoverished, not less than of the proletariat. As the inflation proceeds and the value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery.
Barring a last-minute deal, Argentina will default on billions of dollars of bonds on Wednesday.
It would be Argentina’s second default in 13 years. But unlike the last time, when scores of unhappy Argentines took to the street as unemployment rose to 25 percent and inflation soared, this default would look decidedly different.
Argentina’s equity, bond and currency markets, which have been volatile in recent days, would certainly feel a jolt. The government and Argentine companies, which have been largely locked out of global markets since the last default in 2001, would find it even harder to raise money. And the economy, which has struggled with stagflation for years, would most likely slow further.
But the reaction will probably be muted because this default is not a surprise.
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