Gold As An Investment

A typical gold Kilo Bar, or 31.15 troy ounces, or $52,116 US dollars.  Nice, eh?

  This is a guest post from BullionVault Even after a decade-long bull market, many people look upon the idea of buying gold as a bit strange, almost like something from the past. We see advertisements and companies advertising “Buy Gold” arrangements, yet it is rarely explained what exactly the benefits of purchasing gold stock can actually be. Indeed, those who do buy gold often trade it as they would any normal, publicly traded stock – seeing as the prices of gold rise and fall much like a regular stock. So, what exactly is the benefit of investing your money in actual gold? Well, it depends upon your personal preferences and style of investment – however, there are certain potential benefits that may intrigue … [Read more...]

Prospect Generators in Mining — The Global Outsourcing Trend Continues

Screen Shot 2012-03-20 at 5.05.07 AM

American Airlines is looking for partner airlines to manage flight route out of the U.S. Oil and Gas refining companies outsource their engineering, procurement and construction. Automobile companies have gone from vertically integrated manufacturers to mere assembly plants.  Maybe they build the engine, maybe they don't.  Most components from seats to batteries are outsourced. The mining industry seems to be no different with regards to exploration.   Major mining companies used to have exploration divisions, staffed by competent geologists who scoured the planet for mining resources.  Nowadays, the flavor of the month (along with rare earth elements) seems to be companies who follow the "prospect generators" model. This … [Read more...]

Canadian Natural Resources and the Ecology of Business

"The Return of the Miners" - Constantin Meunier (1831-1905) - oil on canvas, Meunier Museum, Brussels

In my day job, I have to scour the planet for the cheapest/best/safest companies to manufacture our company's products. For the novice, the easy answer to "cheapest" is to find the lowest low-cost country (LCC, in procurement-speak) of choice, and a willing orphanage ready to put those lazy kids to work. Nazzo fast, Guido. Factories that manufacture equipment for the oil and gas industry (or aerospace, or automotive, or power gen) in turn require a host of outsourced and specialized services.  Testing, batch processing, finishing, contract labor, maintenance, etc. Each industry center of excellence creates is own ecological environment where sub-suppliers are born, fluorish, are swallowed by bigger fish (merged and acquired) … [Read more...]

Centavos Portfolio Update: Blood in the Streets

December 2011

"Buy when blood is in the streets, even if the blood is your own" - Baron Rothschild, 1871 Sure is plenty of red in the return column of this blog's model portfolio.  Junior exploration stocks in general haven't fared well in the last six months, and my stocks haven't been the exception. The last update was in September, and things haven't improved since then.  Down 40 percent, even after allowing for realized gains from two trades. A bit of an ugly picture, huh? Good. That means opportunity. Operation Recovery Malaga is first up in Operation Recovery.  The original purchase was for 1000 shares at $0.24/share. The purchase of 5,000 more shares at $.108 brought the unit cost down to $0.132. Whither Malaga and … [Read more...]

How To Buy Junk Silver Coins On eBay

Screen Shot 2011-12-01 at 9.01.46 PM

Following up on last week's post on junk silver, here's a quick tutorial on how I buy junk silver coins on eBay. As always, I must caution the reader that this is what I choose do with my own money.  It's not financial advice (obviously) and I'm just a guy on the internet, not a Certified Financial Advisor (even more obviously). What I Shy Away From Proof coins or collector sets. The mint condition of the coins can add a significant premium, up to twice the silver value. Pre-1940 coins.  Walking Liberty, Peace Dollars and Mercury Dimes are nice, but the problem with older coins is that they've seen a lot of circulation. Lots of touchy fingers have rubbed on them, wearing down the face profiles and therefore losing some of the … [Read more...]

Junk Silver In A Household Economy

B yen military scrip bill used in US-Occupied Okinawa

My wife and I have been frequently accused of exploiting our children for cheap manual labor. True to some extent, even though the accusations are being leveled by said children. :-) We do pay them.  For a few shekels here and there, they get to learn the responsibilities of keeping the house clean, doing laundry, and helping Mrs. 101 with deep spring cleaning chores. Occasionally, we also give the opportunity for some extra money chores like special projects in the garden,  assembling furniture, or vacuuming out the cars.  The boys occasionally grumble, but they're good helpers. The downside to this is that with a ready source of cash inside the house, there's a strong disincentive to seek employment outside the house.  A … [Read more...]

Golden Links

Very cool, totally unrelated photograph.  Ansel Adams:  "Tractor Repair at Manzar Japanese Internment Camp"

I've been catching up on my Northern Miner reading, and reviewing the mix of topics. Seems like I'm a little overdue for some posts on mining stocks.  My model portfolio hasn't been doing so hot, as commodities have taken a tumble. As Retire by 40 writes in this post ("How Often Do You Check Your Net Worth"), we tend to check our stats and showcase our wins more often in a bull market. We're all smart and clever and good-looking when the market's churning ever on up.  In a down phase, we're hunkering down, retrenching, and reaching for the zit cream. Well, I'm going to be making a few average-down trades during next week, so probably in 10 days or so I'll have another update.  On Friday I sold my 200 shares of Hathor Exploration. In … [Read more...]

Centavos Model Portfolio: The market, it burnsssss ussss..

USA Financial Service Model Portfolio of Penny Mining Stocks - September 2011

Time for another update to the Centavos Model Portfolio of penny mining stocks.  The picture has not gotten any better from the last update (Model Portfolio Haz Sad Face) back in May.  It may strike readers as a little strange to post an update on very volatile equities strange after a hard down day like yesterday, especially as you can see from the portfolio snapshot, the return column is swimming in a sea of red.  But it’s only a paper loss, natch. (click on the spreadsheet for a larger view) A couple of notable changes since the last update: Added some more shares Coral Gold, doubling the position to 4,000 shares. Hathor Exploration is being courted for an acquisition by Cameco, one of the larger uranium mining companies out … [Read more...]

Caffe’ Corto: A short take on Gold Mining Companies And Valuations

Inspired by the very popular Len Penzo’s  “100 words on...” series,  and by the article I read today on Yahoo finance, here's a short take on gold mining companies and the Centavos Model Portfolio. The Centavos model portfolio that I've showcased on this blog is drowning in a sea of red ink (Last update in May:  "Centavos Model Portfolio Haz Sad Face".... sad face? Wait till you see the sorry mug in the next update), as various metal commodities like uranium and tungsten and thermal coal have headed south along with the general market.  Even with the dollar price of physical gold bullion nuzzling up past all-time highs, gold and silver and other mining stocks have taken it in the shorts. Along comes this article from the … [Read more...]

Gold Bubbles and Gold Stocks

Image via Wikipedia I'm doing my bit to reduce internet clutter, and recycling an old post that ran November last year, with only some minor editing. Waste no, want not. Gold has been on a manic up-and-down swing lately, and back in the news. It's either a hot new investment (on the uptrend) or a bubble ready to burst (on the downtrend). When the frenetic, bought-and-paid-for Jim Cramer jumps on the bandwagon starts talking about buying gold as a currency, it might be time to start thinking about the start of a bubble.  His advice was generic (as usual) and a bit dangerous: Buy physical gold Buy an ETF like GLD Buy Gold Mining stocks Well, buying gold mining stocks is easier said than done, and buying them on the dubious … [Read more...]