Why just a Greenspan book on Bush and their relationship ? why not a book re Clinton as well ? AG lowered and raised rates just as much from '94 through 2000, and, we know through his book that he was in the WH during that time advising on policy....wouldn't a book covering both admins, both presidents be more educational ?

I dont understand why people arent discussing the

AMERO

I believe it is coming within 5 years.

A one currency with Canada and Mexico, its why there is rather disregard for the USD and the allowing of amnesty for Mexicans

-

Greenspan says the world was better and more free under the gold standard [October, 2007]:

Need flash player (video at bottom):

http://www.itulip.com/greenspangold.htm

or try youtube here:

http://www.youtube.com/watch?v=caIgP3Mnb6g&eurl=http://cryptogon.com/?p=1536

Last night's probability problem:

If you roll three dice, what is the probability of rolling at least one six?

No correct answer yet.

Mike, you stay up as late as I do! And I know the Hunt's were trying to hedge inflation not corner the market, and I know the Comex changed the rules to nail them.

Also, stocks are in my estimation much more likely to exceed their old highs than they are to fall dramatically, based on the fact that the uptrend is still in place.

Harmony gold looking good pre-market.

From Calculated Risk Blog... Couldn't have said it better myself:

http://online.wsj.com/article/SB119374308547676099.html

WSJ: P&G, Colgate Plan to Increase Prices

Pressured by high commodity costs, Procter & Gamble Co. and Colgate-Palmolive Co. said they would raise prices on consumer staples .... P&G's price increases will be particularly extensive, between 3% and 12% on goods including diapers, fabric softener and pet food.

"That suggests P&G and Colgate have significant pricing power. A rate cut with rising prices and a moderate growth forecast? Who's the Fed Chief? Arthur Burns?"

re AMERO

The Coming Merger with Mexico and Canada" (WND Books, ISBNs 0-9790451-4-2, $25.95, July 2007). Not only did Fox admit that he and George W. Bush have "agreed" to create a common currency, the Amero, he contended that a North American Union is "inevitable"

http://www.webwire.com/ViewPressRel.asp?aId=49877

Our FedCall research note on today's FOMC meeting in Washington, D.C. has just been published on our website, http://www.2globalmarkets.com.

The report is in the FedWatch section, on the FedCall page at http://tinyurl.com/yuxpxh

From Don Harrold's morning commentary:

"This morning, GDP numbers were announced that suggest the "USS American Economy" is just flat-out full-steam ahead. 3.9% growth. That's two quarters in a row of near-4% growth.

Huh.

Now, let's not quibble with that data. I mean, what the heck, I'll admit (for this commentary) that the numbers are valid - or as valid as any other numbers in a rigged system.

But, I do have a question. We are still able to ask questions, so, I will ask one: If "the federal reserve" supposedly is here to help us, AND, if the way they "help" us is to lower the rate of interest we are charged to print and then borrow our own money, AND, "the fed" lowers rates when the economy "needs" it, why would "the fed" lower rates NOW?"

Leopard vs. Vista: feature chart showdown

http://www.engadget.com/2007/10/27/leopard-vs-vista-feature-chart-showdown/

Bill,
I posted on my site a "Surprise GDP!", thanks to the underestimation of inflation. A revision of 1%
in the future would not be surprising.

Bill, I agree with your straddle suggestion. I'm looking at the SPY, which has traded between 149-157 in October. So my strategy was to split that range accordingly based on the open at ~153.80.

FWIW, the premium on the near options came down a bit at the open.

Is it just me, or does this FOMC have a lot more coiled tension than usual? I'll be real surprised if the market doesn't become extremely volatile at 2:15.

Frankly, I'll be glad when today is over and this stupid waiting game is over until December.

If you roll three dice, what is the probability of rolling at least one six?

1/6?

"P&G, Colgate Plan to Increase Prices"

Inflation? Inflation! We don't have no stinkin' inflation!

When calculating the probability of multiple events you multiply, not add.

"If you roll three dice, what is the probability of rolling at least one six?"

42.12%

I'm just guessing. ;)

Shark -

91/216

multiply if "INDEPENDENT" events

multiply if "INDEPENDENT" events

Each dice has a 1 in 36 chance of landing a six. So, there are 3 dice that can do this...so 3/36 = 8.3%

Ut oh - Canada might now be in the path of Noel. Home owners insurance is already hard to find in coastal regions of the US. Guess insurance companies will soon be exiting the maritime provinces of Canada, too. Pretty soon only homes that are built in caves in Arkansas will have wind and fire coverage (but not on contents).

" ... The latest computer model runs from 00Z and 06Z this morning all take Noel through the Bahamas, over or near Andros Island and Nassau. The SHIPS and GFDL intensity models forecast that Noel will have 60 mph top winds by Thursday afternoon, when the storm should be leaving the Bahamas. The HWRF model does not intensify Noel. I expect some intensification, given the better vertical alignment of the surface and mid-level centers of Noel, respectable 995 mb pressure just measured by the Hurricane Hunters, and the improved satellite appearance of the storm. A storm with 50-60 mph top winds on Thursday afternoon is a reasonable forecast. None of the models take Noel over South Florida, and the region most likely to suffer wind damage from Noel will be the Canadian Maritime provinces of Nova Scotia and Newfoundland. Noel is expected to transition to, or be absorbed by, an extratropical storm on Thursday. This extratropical storm will then intensify, potentially bringing sustained winds of 55-75 mph to the Canadian Maritimes on Saturday night and Sunday morning. ....
http://tinyurl.com/3doh2e

each roll of the dice has a one in six chance of producing a six. So, isn't the chance (across 3 independent rolls) 3 in 6 or 50%?

When calculating the probability of multiple events you multiply, not add. In this case, the probability of NOT rolling a six on a single die is 5/6. The probability of not rolling a six on three dice is (5/6)*(5/6)*(5/6) = 125/216 = 57.87%. So, the probability of rolling at least one six is 100%-57.87% = 42.13%.

Congratulations Jumble and N2son!

Whenever you are talking about the chances of something happening "at least" a certain number of times it is helpful to think about the complement i.e. what are the chances of rolling no six's? For one die that is 5/6, for three rolls it is (5/6)^3 or 125/216. So the chances of rolling at least one six is (216-125)/216 or 91/216.

Shark... Doesn't it depend if you throw out all 3 dice at once or roll them one at a time? Your analysis is for the consecutive roll case where you stop rolling if a six appears...

http://mathforum.org/library/drmath/view/56502.html
Last paragraph...

Uranium One rocked by guidance
10:00 EST Wednesday, Oct 31, 2007

Uranium One Inc. has stopped ticking after RBC Dominion Securities downgraded the stock to “under perform” from “sector perform,” cutting the price target to $9 from $12.
In TSX trading Wednesday morning, the stock has plunged 17 per cent to $10.53 on turnover of nearly 12 million shares in the first 30 minutes of the session.
Analyst Adam Schatzker points to the miner’s revised production guidance for 2007 through 2010, which consist of “dramatic reductions.” While he figured on some shortfalls in 2009 and 2010, the revised forecasts are “significantly lower in 2008.”
His revised forecasts “remain lower than management guidance, but the difference is much less now than before. We think the revised forecasts are more achievable, but we are continuing to err on the side of conservatism,” he writes.

© Copyright The Globe and Mail

Ok, so it doesn't matter... I guess the best way to think about this that rolling 6 dice does not guarantee that a 6 will come up, so the odds are less than 1 always. Here is a great description:
http://www.edcollins.com/backgammon/diceprob.htm

Maybe a better question is: What are the odds that the FED will cut rates 0.5%?

"If you roll three dice, what is the probability of rolling at least one six?"

Depends on if the Fed cuts rates and whether molecules are bouncing around Jupiter...

Newmont Mining 3rd-quarter net doubled, revenue up 49%

(8:58 AM ET) TEL AVIV (MarketWatch) -- Newmont Mining Corp.,Denver, reported that third-quarter earnings doubled on 49% higher revenue. Profit reached $397 million, or 88 cents a share, from $198 million, or 44 cents, in the year-earlier period. Earnings from continuing operations were 72 cents against 9 cents. Revenue came in at $1.65 billion against $1.1 billion. Newmont narrowed its outlook for gold sales to a range 5.2 million to 5.4 million ounces at a cost of sales ranging $400 to $430 per ounce for 2007.

Newmont Mining 3rd-quarter net doubled, revenue up 49%

Re. above,I'm holding some ABX calls and am wondering if anyone else is too???

Isn't the GDP number inflation adjusted? And isn't the adjustment number based on the hedonically adjusted core inflation number? If the numbers are deflated with a too-low inflation number, that would explain a lot.

Just wonderng why these number seem so high. Should I believe them, or my own lying eyes?

For example, members of my extended family are in the construction business. All they say is "It's done. Toast." Yet the construction numbers are higher. Led by public construction at almost 2%.

Is that PWA 2?

shark,
it's fascinating stuff. Reading that book gave me a lot of insight.

It also explains, indirectly, what happened to Ted Butler with the OJ incident, about which he does not like to talk very much.

BTW, Gold just went vertical.

shark...

Each dice has a 1 in 6 chance. Therefore the three together has a 50.3% chance for an individual six (.167 times 3).

Regarding inflation

I happen to agree with The Economist editorial which raised the question if central banks should target a wider inflation measure that includes asset prices as houses and even stocks.

That on itself would bring better predictability, reduce uncertainty and improve assset allocation.

Here in the U.S. the government wants us to believe that there is no inflation. Actually starvation reduces inflation and it has de added bonus that it improves the fiscal accounts as the government would not need to pay social security as we will be dead.

I just find this Fed utterly irresponsible as it is fuelling inflation. The Fed's independence has ended as Ben now has a dual reporting line: One to Wall Street and the other to the current administration.

JP,
They used to count housing prices. Then they started to rise so housing prices were swapped for rent. Now that rents are rising and housing falling, be alert for a switch back.

Paulson has plainly stated it: inflation numbers are now all about perception - perception by consumers of prices, and 'management' of that perception. It has little to do with accurately measuring real price inflation.

Billionaire Buffett still complaining his taxes are too low

"Multi-billionaire Warren Buffett has been complaining for years that his taxes are too low. Last June, he said at a fundraiser for Hillary Clinton that he was taxed at only 17.7% last year on his $46 million in income, while his secretary paid 30% of her $60,000."

http://rawstory.com/news/2007/NBC_Warren_Buffett_wants_more_taxes_1030.html

S&P starting to inch upward. History rarely repeats, but are we getting another tell?

Bear Stearns and Credit Suisse looking for gold to top $800 within a week of any rate cut:

http://tinyurl.com/35mfcg

It just climbed 10 bucks in six hours. A whole week for another 10?

If they cut, I say it's 800 in a lot less than a week. Maybe a day.

Inflation picked up more-than-expected to 2.6% in Europe, gold, oil and many other commodities are pointing to inflation -- But "Helicopter Ben" will lower rates.

It just does not make sense -- I wonder if the dollar will meltdown soon.

Mike- paired with an indifferent HGNSI reading of 51.8%:

http://tinyurl.com/3bh73w

Map your keyboard with DoubleCommand.

http://doublecommand.sourceforge.net/

Bill,

You can always get a different keyboard with a real delete and backspace key, but then you lose the cool mac one

Oh also, Fn+Delete will do a fwd space delete

Bill,

I use Gadwin on Windows and SnapNDrag on the Mac to do screencaptures into image files. SnapNDrag has very similar functionality to Gadwin.

SnapNDrag is available as freeware from http://www.yellowmug.com/

They have a more powerful version, SnapNDrag Pro, for a modest fee.

My long-term portfolio up 2% already today? This market is going to tank if they dont cut

Mom & Pop are done for if they do cut rates.

Leopard with chinks in its armour
A second look at the Mac OS X Leopard firewall

Apple is using security in general and the new firewall in particular to promote Leopard, the latest version of Mac OS X. However, initial functional testing has already uncovered cause for concern.

http://www.heise-security.co.uk/articles/98120

The cut is a given -- They will deliver what the street has been asking for regardless of a weaker dollar or higher inflation.

If one bubble pop, lets create another one to balance things out -- they call it risk management mode.

Go baby go... ...lets just trade bubbles and the last guy in needs to turn off the lights...

shark- do you have a take on GSS..

2nd,

I don't really have an opinion on GSS right now. Except to say that I am not compelled by any technical indication to buy any. As you know I am in Harmony.

OK, thanks...looking for ways to tweak a gold trade should the opportunity arise...

October 31, 2007
Macdonald Closes Strategic $10 Million Brokered Financing With Key Mining Individuals-Preparation Underway for November Drill Program
TORONTO, ONTARIO--(Marketwire - Oct. 31, 2007) - MacDonald Mines Exploration Ltd. (TSX VENTURE:BMK) -

The $10,000,000 private placement financing previously announced on October 26, 2007 has been completed.

The Company is pleased to welcome Robert McEwen - Chairman & CEO, US Gold Corporation, Pinetree Capital Ltd. headed by Chairman & CEO - Sheldon Inwentash, Pierre Lassonde - Chairman, Franco-Nevada Corporation, and Randall Oliphant - Chairman, Western Gold Fields Inc. as shareholders and strategic investors in MacDonald Mines.

The proceeds will be used to fund exploration programs on the Company's James Bay properties and for working capital purposes.

more thoughts on FXI from marketwatch- china's GDP to surpass US by 2038?

http://tinyurl.com/29guks

Any ideas as to why UXG is down 2.5% when virtually every other gold stock (except KRY & DROOY) is up big?

Bill - BMK and the other Fauld's Lake plays are already on the list.

Re: BMK
Please be aware that the $10 million private placement announced on October 26 was at 40 cents per share. The current price is 78 cents.

anyone else trying to get into ben's head- while out in the back cleaning out the skimmer found myself wondering...was he smiling or scowling when he washed up this morning...taking calls or alone with his thoughts on the drive in...confident or apprehensive striding into the boardroom...leaning back in his chair or pounding the table with an hour to go...either way his heart has to be racing going into the announcement...what a job...

On June 27 2007, Bill mentioned a solar panel company named OPL:

http://www.billcara.com/archives/2007/06/caras_daily_commentary_wed_jun_3.html

Bill mentioned "I have a sense that things are about to happen with this company, and so I alert you now." "I'd like to be a part of it. It's one to do your homework on."

The stock was trading at the time at around $1. Today it is around $2.30.

oil service stock: HERO
Leisa had this one mentioned at her website some time ago. Fido research validates with buy by deutsch bank analyst. A buy was just reiterated and analyst has an 88 ranking for success. I'm thinking that selective service stocks are undervalued. Disclosure: own HERO and OMNI.

Bill's DB post on oil and gold reads like what we've been hearing from Bill all along. GDX may lag pog/GLD due to cost issues. Having the right list of miners that meet the metrics IS the gold mine. An alternative view is that maybe GDX will work out ok if the straggling miners are acquired?

"The only factor left is for you to determine the quality of the company and the metrics I show above as well as the RSI Accumulation Zone studies, ie, any time the Daily RSI approaches 30, you write puts and buy calls."

Posted by: Bill Cara at October 31, 2007 1:27 PM

AT THE RISK OF SEEMING INCREDIBLY STUPID:Do you base this on Intraday prices and if so how to do it??

re GDX: Jasper, GDX is cap-weighted, and therefore dominated by the largest gold miners. Per etfconnect.com ,

As of 5/31/2007
Holding Dollar Value % of Total Portfolio
BARRICK GOLD CORP. ABX N/A 16.42
NEWMONT MINING CORP. NEM N/A 11.93
ANGLOGOLD ASHANTI LTD. AU N/A 7.63
GOLDCORP, INC. GG N/A 6.58
GOLD FIELDS LTD. GFI N/A 6.23
HARMONY GOLD MINING CO. LTD. HMY N/A 4.86
COMPANIA DE MINAS BUENAVENTURA SA BVN N/A 4.66
KINROSS GOLD CORP. KGC N/A 4.54
YAMANA GOLD, INC. AUY N/A 4.29
AGNICO-EAGLE MINES LTD. AEM N/A 4.24

FRB Press Release:
http://federalreserve.gov/newsevents/press/monetary/20071031a.htm

Schwab has locked up on me. The decision was as expected, but I'm flying blind.

that was really disappointing

I am holding a couple puts in the XAU as a hedge on my gold positions...

XAU Falling off hard after .25 cut...

Watch your gold positions...

Like I said yesterday: a 25bp cut, a mention of *intensifying* housing correction, and a warning that increased commodity prices "may put renewed upward pressure on inflation." "The Committee judges that, after this action, the upside risks to inflation roughly balance the downside risks to growth." This means to me that they are not planning to make any more rate cuts if things do not change by their next meeting. The Fed funds futures were pricing in a *series* of rate cuts until the end of the year, and so the market is unhappy.

Jock,
But even if staying in the large cap realm, which ones meet Bill's metrics? Where's the data base to make an evaluation? Are some of these going to merge or be acquired because of cost and reserve problems? Is there a reliable closed end fund to get a basket with more good junior miners than bad ones? Ergo, guilty of the Easy Button but fascinating to follow.

Technically, the SPX failed to break through that 1543 resistance again. Time to board the train to Shortsville.

i don't think 25 basis points is enough to keep GOOG and AAPL propped up much longer- scaling back into QID...

TD ameritrade locked up on me; now back after a minute or two of daydreaming...

"I feel like I'm at a race track with in-race betting."

That sounds like fun.

People - What happened around 2:24PM ET? Seems like EVERYTHING took a sharp dip, then quickly recovered ..

I would wait for the close as there are often false moves immediately after rate decisions. Its really rallying just now.

That being said SP 1540 is a line in the sand for the bulls/bears.

Do not fight the FED.

The Fed just cave in to the market once more -- nothing new here. Just plain irresposibility.

The dollar continues to go down -- I suspect we could see a meltdown at some point as people can not take the pain any more.

In any case, I believe the seeds for financial disaster have been planted...

GOLDEN BAND 2007 AGM

I had gone to the 2007 AGM Meeting in order to determine whether to sell all of my shares in the company or to continue investing. (I have access to low cost travel $25 return YYZ - YXE - YYZ. Business class. Seats are open. Day room $60, Starbucks on the corner. heh heh heh) When I got home, it was the first good nights sleep in several weeks since the August crash. I had to settle my thinking on this company.

I was very challenged and alone with the issue of the gold deposits in La Ronge, Saskatchewan, because despite the similarity of my thinking with the directors and qualified engineers of Golden Band, it took every ounce of effort on my part to remember the details and bring out the discussion, since absolutely everyone stood head and shoulder above me in qualifications. I had to stow away my own feelings of being limited in knowledge, because everyone was at the top of their game, and I had to be top notch.

Everyone with the company was there, including Ron Netolitzky who chaired. Present at the meeting were the stakeholders within the Native community who had the opportunity to discuss their concerns and allow the company to speak and answer. There was also a lot of discussion of the environmental process and how Golden Band is a proactive miner that goes over and above the political requirement in a sustainable bid to actively mine the gold in La Ronge. Nobody believes there's gold in Saskatchewan, but the 2007 AGM would convince investors otherwise.

What I found was a company challenged by having to deal with small investor demands while in truth this company requires a large investor. This company does not make a good investment opportunity for the small retail investor(unless they have a very long term outlook), because it does not have the speculative upside that many a mining company had presented during the recent bullion growth market. (I believe they are entertained while speaking to small, knowledgeable investors, but they really need to spend time with the larger interests. This company is crying out for that kind of attention. They are some of the best people in the business and require some of the best people in the investing business to take note of them.)

Be confident that your fellow investors feel as you do that the float has become enlarged. A resolution to expand the available options to 10m. shares instead of 8m. shares was voted down. The company maintains that they require expanded options availability in order to retain quailty employees. Mr. Netolitzky agreed that it was a good suggestion, that we have people in mind when asking for more options. Its bound to come up again when more expertise is hired on.

They would not have shone during the Cambridge House or the PDAC, simply because their float has become enlarged and there are so many other speculative opportunities out there when the base metals attract more attention. Its all a matter of numbers, in the end, and the numbers are only just beginning to fall into place for this company after so long in the field. They have a great exploration potential at the same time as having a low cost entry into production. Both can be accomplished at the same time.

If I perceive correctly, the company is inundated with small investors expecting an upside return to their holdings, while the larger investors jump on the gold band wagon investing in companies such as Barrick and Northgate or perhaps expecting that Rob McEwen has some talismanic power to devine the location of the next large gold deposit. How Rubicon or US Gold could grow phenomenally while not having any results to achieve the share prices they have are just the most blatant examples of speculative mania in the gold sector amongst large cap investors. Golden Band has those results. (I expect to be challenged on that notion.)

This company presents a sterling opportunity for a large investor of the type of ETF or mutual fund or private investment company that invests in gold looking for a small company to invest in which has the potential to grow phenomenally. As I have stated the small investor will only be frustrated with the share price. But opportunity knocks for the large cap fund wanting stable growth in a politically safe environment.

A large investor could easily purchase millions of shares in short order and still expect to see growth in their share price over the long term. The company is trading ~5% - ~8% NAV and yet, they have produced some of the highest grade cores on the planet. (I expect you to challenge me on that notion) They have a top notch mining team, and some of the best professionals available to move the company forward.

Even so, I continue to read statements by large investors that the gold sector is not a growth sector. Every one, it seems wants to be pontiff when it comes to gold or expect an easy, risk free return through bullion, mutual funds or placing the hard earned money of working people with biggest zombie corporations on the planet encumbered with enormous gold derivatives and hedges. People are expecting the same opportunties NOW only available in 2001 in the gold market as the Nasdaq was crashing. They will be disappointed in the main in gold investing, because the timing is held off by a deflationary boom.

In my opinion, its time to look at emerging gold producers. Golden Band Resources is one of them.

I was present for the 2007 AGM Shareholder Meeting, and I truly enjoyed the presentation:

http://www.goldenbandresources.com/i/pdf/gbn-2007-agm.pdf

THE FUNDAMENTALS DETERMINE THE SHARE PRICE

Oh man, I like this company and the people that work there. But we should look at the fundamentals and make a serious appraisal of its potential and the operational factors.

The share price has tracked the $US Gold Price vs. the Loonie. Despite the fact they have been tabling milestone, company-changing results, the share price has been stubborn.

Here is my perception of why. This chart is very revealing, that GBN.V has tracked the fundamentals quite closely:

GOLD VS LOONIE GBN.V Overlaid Since 2002:

http://www.flickr.com/photo_zoom.gne?id=1806819339&size=o

GOLD VS LOONIE GBN.V Overlaid Recent:

http://www.flickr.com/photo_zoom.gne?id=1807668134&size=o

WORLD ECONOMY TO DIRECTLY AFFECT CANADIAN GOLD PRODUCERS

It is my belief that the Loonie is overshooting after a long bull market and that the $US is undershooting due to collapsing markets domestically and a deflationary boom elsewhere in the world. This is about to change for the longterm and right itself. The wheels will come off the cart on the emerging markets story as hyperinflation sets in, and political disturbance and economic disparity crushes the more rickety markets. That would place GBN.V in the crosshairs of a bid to become overwhelmingly profitable even if the gold price remained stable @ $630 US. Gold prices will continue in its bull market, since investor demand for gold will greatly outpace speculative demand, even if the $US recovers some of its former glory as the world reference currency. In the meantime, the speculative energy in the base metals sector will have abated, and the off warehouse inventory will flood the market. By contrast, off inventory gold has always flooded the market at all times, so when hard currency is in demand, such as during a credit deflation, then gold is held off the markets, somewhat in reverse of the base metals. So any investment in base metals should be avoided like the plague and pure gold mining plays should be sought out.

EXPLORATION

Exploration will become exciting for GBN.V, since they are employing gas hydrocarbon methods for discovery as of late. Gas hydrocarbons are given off by microbial activity within the soil and the underlying rocks giving off a certain signature for each metal. The output of organic activity within the rock is measureD in parts per trillion. So the gold within the outcrops gives off a signature. They measured this activity against one of the recently acquired deposits, which happened to show the deposit as an anomaly, and still more of the same signature nearby. So this method works. This is why I say they will have a strong exploration upside going forward.

On discussing this method with engineering staff formerly employed in Red Lake at the Campbell mine, the probability that Golden Band is sitting on a large discovery is fairly good, since such discoveries are at depth and take a great deal of time to be revealed. A profile of large high grade discoveries reveals that it takes a good deal of exploration effort, that academics scoffed at the notion that hemlo was in an area not partcularily suited to gold for instance, and yet there were many smaller mines in the district since a very long time. Red Lake was very similar to this. San Gold has discovered high grade gold at depth after many years of operation and the mine went defunct. Academics on the subject of gold deposits in LaRonge, Sask are all about the small nature of the deposits and that none of them go to depth. Recent results show that this assumption is wrong. So went the discussion and I found that there was no ridicule on this issue in the least amongst the directors of the company.

There is a large, near surface exploration upside here, without even taking a look at the favourable geology for deep deposits, however.

PRODUCTION

As I say, there was no ridicule on the notion of having a large high grade deposit at depth, I did get a little bit of a RAZZ when questioning the company on bulk sampling. Apparently, bulk sampling will reveal the true nature of the geology and grade of the Bingo deposit set for production. I was RAZZED when asking whether a bulk sample requires an operational mill. This is apparently not necessary, as the bulk sample is carried out similar to a large assay process and can be determined without having an operational mill. So the bulk sampling can be conducted without implementing a production footing, at the cost of assaying. It is a moot question, though to ask whether bulk sampling is required for Bingo, as recent core samples have demonstrated that basically, we have a mine which goes to depth.

A discussion amongst the engineering people suggested that the Bingo deposit, for instance, or one with such a nature, will easily go to depth. So its not a question of if, but when this company goes into production. And that bulk sampling will only improve on the results obtained.

START UP COSTS

The start up cost for this company will be in the area of $25 million. This is a tiny amount of development cash. It will be the last hurdle before the company becomes a bona fide gold producer and start pouring gold bars. Time window to production is 12 - 18 months following the tabling of the final Positive Economic Analysis. Once the numbers are in place, the company moves forward. It will not be economic for the company to assume all of the costs of implementing production based on the production itself. They will in all probability require to issue some more shares, and take on a little debt. But as long as this does not require an onerous debt load requiring years to pay off, that they can pay down debt very quickly, this will be the option they will choose.

Its my opinion that investors need not greatly fear the financing process going forward, because the numbers posted in the economic analyses are very conservative. However the company goes about achieving production, the financing will be conducted in a conservative manner, and with respect to the shareholders.

QUALITY OF THE MILL

The quality of the mill is deemed to be very good. GOOD NEWS. Sask Power is going to hook up with the mill, which saves ~$100 dollar per ounce in production costs.

CONCLUSION

This company is low hanging fruit for the right institutional investor requiring that they invest in a company with excellent growth potential. Small investors may be disappointed in the lack of speculative upside, as I have. The opportunity to make money here is unmistakeable.

F6

HERO is rolling today, up to 27.30 as I write. Congrats to anyone who got in on this and waited it out.

New China moves:

- UBA Nigeria, one of its 4 big banks announcing a deal with China Dev't Bank(which per FT has more assets than World Bank and Asian Dev't Bank combined).

- Egypt't Trade Minister announcing a deal with Chinese TEDA for a 5 sq.km. industrial zone aiming to attract US2.5B in Chinese investment.

This, two days after US$5.6B investment in South Africa's largest bank. Wasn't China's investment in Blackstone just US$3B?

I wonder if China is the most influential source of capital for Africa - yet ...

UXG: Adding at 4.56

"With this decision the risks between economic growth and inflation are balanced".

Wow, are those fed guys are wicked good! This is what Utopia smells like. Life doesn't get any better than this. Sit back, relax, the Fed's got it all covered.

"I wonder if China is the most influential source of capital for Africa - yet ..." Posted by: Jock

I think so. The Chinese seem to be everywhere in Africa. Some of their initatives are beneath the radar and only come to light later. Mining, manufacturing, you name it. BBC seems to be more alert to what's happening.

What a joke. CNBC was rambling away on how "HAWKISH" this move by the Fed was.

"With this decision the risks between economic growth and inflation are balanced".

Wow, are those fed dudes are wicked good! This is what Utopia smells like. Life doesn't get any better than this. Sit back, relax, the Fed's got it all covered. The needle he needed to thread was so tiny, so small but this is the "fed" were talking about.

(sarcasm)

"Yes, lets keep the stock market bubble going" Ben Bernanke as he was cheered by this colleages (got it from a fly in the wall)

"Yes, lets keep the stock market bubble going" Ben Bernanke as he was cheered by this colleages (got it from a fly in the wall)

"Yes, lets keep the stock market bubble going" Ben Bernanke as he was cheered by this colleages (got it from a fly in the wall)

Jumping in with 2nd and number2

Shorting the QQQQ's

Nov 54 puts

This rally just stinks of short squeeze to me...

And guess what's the Drudge Report's main headline is?

Re hero....to which I thank Leisa...took second half of position with re-iteration today which moved this one...and possibly news of expanding service model.

What a shake out after announcement. I finally protected profits and sold GS...only to do so at the low for the day. A 4% swing! Which way will this resolve...will it be the first or second impulse? Don't fight the trend...replaced with Ben Franklin and Legg Mason...both past underperformers.

rounding out a 1/2 position on QID here...really believe every reaction to the Fed is an over-reaction, and heightened odds of a gain if you play against it...we'll see...

BillySundance,

Bit on HERO yesterday when the daily RSI came above 30. I cheated a little about what I said though, it closed under 25.00 one day but I still bought.
(it was only like 15 cents under though)

Swung to a profit today in ETFC as well. I think the worst is over for them, they bailed on their subprime pretty fast and it's not anywhere near the core of their business anyways.

SPZ up 18 points, dollar easing, oil up over 4 bucks, gold jumping over 13 dollars. Same old, same old. Interesting with crude surging, XOM only up .65 cents. With the crack spread narrowing and refining profits squeezed, perhaps a tell for Exxon's earnings tomorrow. Shorting XOM now.

UXG: a puzzle. I bought on a dip earlier, about where it is now. But, if the vein is deeper than anticipated, higher production cost and just how much higher?

EFU- opening a small position..maybe the international perspective will be more subdued...

Jasper,
Re: UXG. I've been in it and am currently out pending new drilling activity. The last drill results came out in early October. Have you got any idea as to when the next drilling might be completed and results released?

Fred, Jock might know but the chart says not very good results expected.

Anyone have Leisa's website address?

I still can't get over the shock of someone buying 100 shares of CGW at $399 at the open on Monday, when its real price was $26 right before and right after than purchase. How could this happen? Imagine how that person must feel! How can we make sure that this doesn't happen to us? Should we designate all buy/sell orders as "stop limit" orders?

anyone using fido- bid/ask on QID have been out of synch (guessing it's lagging by 15-20 minutes) with real time prices...

david, never sought the print on my fido chart.?

Never buy at market price... I think Cramer's book Mad Money taught me that. (it had a couple good things in it. booyah)

One of the few bummmers about this site is that the incredible amount of information contributed in comments sometimes feels like a fast river rushing by.

I know you can search via Google, but it's not easy.

I just read about two comment systems on downloadsquad.com:

"Both Intense Debate and Disqus offer web publishers an advanced comment system with support for threaded comments and the ability to track users' comments. Both services also offer integration options with popular blog platforms like WordPress, Blogger, TypePad, and Moveable Type.

As a reader/commenter, you can subscribe to comments via email or RSS. And both services let you create a profile allowing you to see all the conversations you're currently participating in from one user-friendly screen."

======================

IntenseDebate also has a feature that helps reduce refreshes. That ought to cut down on bandwidth.

Of course, it will make it easier for everyone to go back and track any of my lousy predictions, so maybe not... ;-)

http://tinyurl.com/2kg7fd

Just throwing this out for discussion. Anyone know a site that uses one of these so we can check it out?

everyone thinks dollar decline from here is a slam dunk..
i would say watch out for a vicious reversal to the upside

gold ..oil..are not trees growing to the sky..making money is never that easy

Re: Leisa's blog

http://theperplexedinvestor.blogspot.com/

Isiah...do a search on Bill's website for Leisa...a function that I often overlook.

ps. "saw" not "sought" in my last post...fwiw.

David I was watching CGW when the trade went through . . . yes, limit orders are the way to go . . . also in this case CGW daily vol is only around 172,000 . .

I surmise someone mistyped or had a price in their trading window from another stock when they hit the buy button. A MM probably hit it right away.

Not sure, but I think a broker may be able to get that straightened out if it was a mistype and the buyer immediately called to correct. Depends on your relationship and if they can work it out with their relationships. Key word is MAYBE. Any delay and no possible recourse. Didn't see it taken off so it was a trade.

GOOG/AAPL/RIMM-

6 month performance: GOOG 53%, AAPL 90%, RIMM 270%...

GBN.V - Fransix, great write-up. Others must have agreed, since the stock was up >5% today !

..and FXI up 97%...

chas......... Thanks for the link to Leisa's web page

shark- btw, congrats on HMY, not to mention that $800 call on gold...

Jock:

China has active in Africa for many years.

"has been active"

Avino ASM.V

Any thoughts on Avino Silver & Gold Mines

Complete drilling details.

http://biz.yahoo.com/ccn/071031/200710310422211001.html?.v=1

Thanks. jfs

Jock:

"GBN.V - Fransix, great write-up. Others must have agreed, since the stock was up >5% today !"

Thank you for the observations, but I was only done late in the day:

"Posted by: FranSix [TypeKey Profile Page] at October 31, 2007 2:51 PM"

I know a number of you may hold FHLB agency bonds. This is not the bonds but a sign of the times.

FHLB of Chicago won't pay a third-quarter dividend

By Steve Daniels
Oct. 31, 2007

(Crain’s) — The Federal Home Loan Bank of Chicago will not pay a third-quarter dividend to the member banks that hold stock in the institution.

The Home Loan Bank, one of 12 regional banks around the country that offer low-cost loans to their members, said in an Oct. 30 letter to its shareholders that it opted on its own to pay no dividend and wasn’t forced to do so by federal regulators.

“While preliminary operating results for the third quarter show positive earnings, the board decided to forego a dividend payment for the quarter in recognition of projected earnings pressure in the fourth quarter and in 2008,” according to the letter, signed by Home Loan Bank CEO Mike Thomas.

The bank’s second-quarter payout was 2.80%.

The Home Loan Bank is suffering declining earnings, which prompted the federal Office of Supervision of the Finance Board on Oct. 10 to bar the bank’s issuance of dividends and redemption of member shares without prior approval. At the time, the bank said it didn’t expect to be able to redeem shares in the fourth quarter of this year and that dividends would likely be reduced.

Bill -

From 10/30/2006 to 10/30/2007, GRMN stock price climbed from $52.56 to $120.48, or +129% (excl. dividends). Great execution, no doubt, but traders have been pushing the envelope for a lot of their darlings - witness the increasing number of blow-ups (down 15+%) on earnings days.

JML

Seamus,
Mortgage-related ABCP issuers had recently gone to the Federal Home Loan Banks, which extended $163 billion of loans to them.
"Countrywide Financial Corp., Washington Mutual Inc., Hudson City Bancorp Inc. and hundreds of other lenders borrowed a record $163 billion from the 12 Federal Home Loan Banks in August and September as interest rates on asset-backed commercial paper rose as high as 5.6 percent. The government-sponsored companies were able to make loans at about 4.9 percent, saving the private banks about $1 billion in annual interest. To meet the sudden demand, the institutions sold $143 billion of short-term debt in August and September, according to the FHLBs' Office of Finance. The sales pushed outstanding debt up 21 percent to a record $1.15 trillion, an amount that may become a burden to U.S. taxpayers because almost half comes due before 2009. The government is ``taking a lot of risks through the Federal Home Loan Banks that are unnecessary,'' according to Peter Wallison, a fellow at the American Enterprise Institute, a Washington-based organization that analyzes public policy, and general counsel at the Treasury Department from 1981 until 1985. The home loan banks, known as FHLBs, are increasing risks to taxpayers by assuming the role as a lender of last resort, said Wallison. That's the job of the Federal Reserve, he said."
http://tinyurl.com/3xaofl

Thank you 2nd_ave. Your recognition means a lot to me.

HAPPY HALLOWEEN EVERYBODY!

I have to go and get the skeletons out of my closet!

Golfer -

Sure China has been active in Africa, but isn't it new to be sprinkling a billion here, a billion there into the leading institutions in key countries?

Seems to me China is thinking strategically about applying dollars to secure resources - in least explored area of the world. Smart !

Fwiw, A couple of months ago I had two computers go down within a week of each other. Not wanting to give up my computers or trusting them in the hands of some underpaid big box employee, I called the local university and asked for the computer dept. Once connected to the help desk I asked who the smartest kid was working there, a few minutes later I was talking to the head of the department, a computer major working on his masters. I told him I would pay him $100/hr if he would come out to my place and take a look at the computers. The next night he had one up and running, the other had a crack in the motherboard, he took it home backed up all the data to a couple of disks and returned it the next day. He said the best two programs to keep your computer safe are free and he installed: SUPERAntiSpyware Free Edition and CCleaner.com I haven't had a problem since. Paid him for two hours of work and made his day. Most college kids are hard working, full of knowledge and short on cash. Just something to think about next time anyone has problem out there. Doesn't just apply to computers, call the dining service if you need a catered event, accounting dept if you need a tax expert, the maintenance dept if...well you get the idea.

GRZ - up 8.5%
KRY - down 1.9%

Dear Bill,

Consider that Drudge trumpeting $800 Gold may be the electronic-age equivalent of Time magazine putting a picture of a bull on their cover. I agree with your subtley unstated suggestion that maybe things are a little overdone. I don't think that today's quarter point with the suggestion of no more to come will embolden many bulls here. I'm not saying anything except that my stance is neutral and I will look to the metal iteslf to provide the clues as to it's next move.

I should mention that I sold HMY in here today; I'm not saying I was right to, but I think we'll all wake up tomorrow and wish we had more cuts coming.

Gold up to $801.50.

Bill,

By the way I meant to mention, wasn't that business with Goldman yesterday going "short" oil and then oil going up like a rocket ship today either a sign of changing times, or a dramatically, tremendously wrong call? I won't suggest complicity in a scheme. But I do bet a year ago they could have knocked the market down 10 bucks with a statement like that and kept it down awhile.

Via B. Ritholz (http://tinyurl.com/29aex6)

ECONOMIC REPORT
Inflation was low because oil prices surged
In GDP math, sometimes one plus one equals zero
By Rex Nutting, MarketWatch

http://tinyurl.com/34nsb4

When accounting befuddles, one must one step from switching from actual valuation to mark-to-model. How about official statistics where all the negatives are isolated, explained away, and made to look "onew-time" events. It doesn't/didn't work for public companies and I doubt it'll work for the government in the end.

JML

JIM, thanks for the link. We’ll have to watch this over the next 2 years. That’s a lot of money to Countrywide among others. Somehow I just don’t believe smarmy CEO Mazillo when he says they’ll turn a profit this quarter. Imagine he’s still dumping shares into any strength despite the SEC pressure.

I certainly wouldn’t suggest purchase of FHLB agency bonds; Federal Farm Credit bureau bonds should be suitable for those who want an agency bond that is also state tax exempt in the U.S. But heh, I’m not a bond guy.

MikeNYC: I am not sure what the right solution might be for the comments section of this blog but I agree with you that a different format or a technology like you suggested, to streamline and track might make sense. I didn't have as big of a problem with it a year ago but now that daily comments are double it's become quite a feat to read through them.

I prefer the type of threading that categorizes threads like a vbulletin once comments and posters become large enough. That way I can scan the thread titles and decide if I want to step in. A daily chat thread titled can still be used. If the daily comments doubles again it's going to get seriously difficult to follow along. Growth is good!

Fransix,

I took a look at the GBN.V and while I can understand where you are coming from, I find it hard to get as excited about them as you.

Exploration – Yes they have a lot of targets and they have some reasonable results. However, I don’t see a lot that distinguishes them from a whole bunch of other companies that also have a bunch of targets and some reasonable drill results.

Even though they are pumping their exploration potential, I am not thrilled with their plans for their scoping study and strategy as per the presentation you provided.

SCOPING STUDY (PAGE 45)

Cash costs of $527/oz is high and total costs to sustain exploration and other non production costs take total cash costs to over $600/oz. Production is targeted at 35,000 oz per year. I have been consistently using $650/oz for my gold price for all my evaluations, but even if I use say $750/oz the margin is $150/oz, positive cashflow is only $5.25 million per year. The mine life is 4 years and so they hope to generate $22 million over the 4 years. They say their target is to increase resources through exploration success and extend mine life to 10 years. So lets say they are successful, a revenue stream of $5.25 million per year for 10 years discounted at say 8% gives an NPV of $37 million.

So even if they are successful in their exploration they will generate a revenue stream worth $37 million or $0.30/share (125 million fully diluted).

Even assuming $800/oz gold then the NPV increases to $49.5 million or $0.40/share

2008 OBJECTIVE – BUSINESS PLAN (PAGE 60)

They are targeting ore to be sourced from 4 mines with one mill. While this could make otherwise uneconomic mines economic by combining the mine output to feed one mill, the costs for mining 4 separate mines is always going to be much higher than other single source mines especially on such a small scale as this.

MID TERM (5 YEARS) & LONG TERM (10 YEARS) (PAGE 62-63)

After 5 years they plan to target 50 k oz production per year and then after 10 years target production of 75 k oz per year for + 10 years.

So even if they are successful in their strategy and achieve an expansion after 5 and 10 years the affect on the 20 yr NPV (8%) is that it will increase to approx $68 million or $0.63/share at $750/oz gold price or $104 million or $0.83 per share at $800/oz.

Please note that this is just my very quick and dirty analysis after a very brief look at the presentation you provided. In my haste I may have overlooked something or under estimated something and would happily stand corrected.

Nevertheless this information would be enough to tell me that there is not a lot of upside here even if they achieve their plans and find the reserves they expect. There are a literally hundreds of companies out there with “targets” on “prospective ground” using “latest technology” to explore. The trick is to look at as many as you can objectively and sort through them and attempt to identify the ones with greatest potential and lowest risk that stand out from the crowd.

That is why I developed the spreadsheet and posted it on this site. I can only personally look at so many companies at any time. The idea was to provide an objective tool that interested readers could use to evaluate stocks and post the results on this site. Together if there was a few of us we could analyse a number of stocks and hone in on the most prospective. We would even post the results of the ones we did not like so that other readers would not waste any further time analyzing them and concentrate on other opportunities.

I would also expect differing valuations on a regular basis that could generate healthy debate about assumption used from which we could all learn from.

Unfortunately I do not have a lot of spare time with my day job and family, but I love doing this and will analyse a number of stocks over the coming months and provide them to Bill and Jock and hopefully they can use them in the newsletter or fund they are contemplating for Junior stocks.

After having said all that – having shares in any junior exploration company can be like also having a lottery ticket as even the biggest dog can sometimes get lucky and hit the JACKPOT. It has happened and will happen again.

Green arrow,

Thank you. CCleaner has made a noticeable difference in the old laptop's performance.

Bill,
Did you check out the link I posted? It's an article that describes and links to two new blog comment managers/enhancers that plug into popular blog software. Maybe your new university tech guy can evaluate them for you.

BTW, I, too, think that's a great idea. And what a great opportunity for some deserving student. I bet the dept head or a professor could tell you right off the bat who would be a responsible, talented choice.

I used to lead software testing teams for one of the top PC/Mac/UNIX calculation software packages. We used to bring in guys from MIT all the time. It worked out very well for both sides.

And of course, $800 is the old historical high.

I don't think this is capitulation in PMs. I think it's letting steam blow off, and it's a retrenchment and a battle for 800.

There's too much at stake.

The 'round numbers' are usually tough resistance. In addition, Sinclair has mapped the last run up, from fall 2005 to spring 2006, directly onto the surge now, and puts the analogous peak in the spring at 1050, where he predicts a battle. I buy it.

Battle=volatility and a chance to make profits trading it, while always keeping a core position for the next breakout. I hope to be able to take advantage of that volatility.

By the way, I thought we were all talking about the cash price in our guesses on gold, not the far contract futures. Spot has not hit 800 and gold looks to be, unsurprisingly, dumping a bit at the asian open.

Goldman paid a lot of money to beef up that TOCOM annex. Don't expect them not to use it.

PS 'Fess up time. I don't mind admitting I made a wrong call - Though I also though 800 was coming quick, I did make the mistake in thinking it would hit 725 again, first. I'm sure glad no one took me up on that bet for two silver eagles.

Financials. How safe, down for a reason?

Being a worrier and wanting a sector to prove itself first...I've largely stayed away from this sector. But today I did buy LM/legg mason and BEN/franklin mutual funds. My thinking began when looking at a chart of BEN over the weekend...impressed by the potential value....and IF the cautious investors finally give in that the asset mgmt guys will benefit...much like the story about the guys that sold picks and axes to the miners made the most reliable profit. A lot of overseas money might pour into our mkt. Growth and not yield is the main story. On the other hand, Dennis Gartman/cnbc tonight really dis'd the Financials as a group. Ned Davis reports are currently positive on lm and ben but quite negative on citi. As irrational as the mkt may be, it is what it is, so I'm willing to maintain some exposure. Will the asset management subgroup get hurt as Citi and other related financials are expected to suffer? Critque welcome.

I though it was 850?

I thought it was 850?

Re: GBN

Aussiontop:

"Please note that this is just my very quick and dirty analysis after a very brief look at the presentation you provided. In my haste I may have overlooked something or under estimated something and would happily stand corrected."

I appreciate the time you took to look at this company. This is a standout company because of the management, first and foremost.

But I am one to say they put the cart before the horse and decided they would go into production as an operational goal, rather than continue to provide good exploration results. They had been tabling good results for years, without response in the markets, so I presume this is the source of their motivation to present the production case.

The drill results are better than just average, but you would have to wade through all of the news releases to find them.

What they are