So Russet, how do we use this information?
You tell me, I just posted it because most of the other information released on newsmedia today indicated a double dip was on the way,...except this. Will it continue?,...those who know will be millionaires. Just how big of a slice of total U.S. GNP are auto sales,5%,10%,..?,...I'm guessing not enough to keep the economy afloat if housing and other consumer spending die, and past history suggests they are all positively correlated.
Me, I'm buying royalty trusts that dip from share offers, mergers, fund dumps etc. Their high distributions (9-20%) seem to be providing a floor with a springboard,...and the oil and gas ones look interesting considering the highest increases in auto sales seem to be coming from the gas guzzling SUV's, trucks and bigger cars. Combine that with the near certainty of an Iraq invasion within the year, the hot weather, declining oil, gas, and distillates storage levels, and a stable if not bullish case emerges for the oil and gas trusts,...many giving in excess of 15% annual distributions while we wait for oil/gas price increases to drive their shareprices up.
My guess is present consumption is being borrowed from future quarters unless your immigration numbers have jumped enormously (maybe they have). Double dip may be coming so I am not looking at industrial metals in the next quarter (October is just around the corner) and am looking to tax loss selling season in November/December to pick up bargains.
PGM's are a question mark. The big auto makers are making more and more cars, but finding ways to use less and less PGM catalysts in the convertors with innovative design, metallurgy, and technology. At the same time Diesel engines are being legislated to use higher amounts especially overseas and consumer preference in North America seems to be to the bigger engines requiring bigger convertors, so stable PGM prices seem likely, but then there is that double dip.
Stillwater,...tell me they have increasing production with lower costs per oz and I will agree with you. It is off my radar screen at present.
Anooraq/South Africa?... got freebies, but current exploration has not found enough tonnage and grade to warrant a stand alone operation. Their best bet so far seems to be the Northern property directly bordering Amplats holdings, but they must rely on Amplats to do the feasibility studies and likely to supply the Capex. And then there is the South African government,...how much will they have to give up to black economic empowerment (BEE). Every miner I can think of is trying hard to diversify out of South Africa, something I tend to think hard on. I had a big position in SUF.t who have most of the Capex in place for a profitable PGM operation, but now I'm out betting on a bigger dip as the South Africans seem intent on pissing off the big established miners,...and then we go back to the double dip.
Things are never simple (ggggggggg) |
