re:[Slider: It would seem that the Juniors are in trouble, the exception perhaps those few that are fully funded to production (e.g. Minefinders). Raising funds via offering is almost out of the question due to low share price/dilution. Financing would seem to be equally difficult given the destruction of lending capacity in the banking industry...I assume that those that have lending capacity will seek out opportunities that present the least risk. The seniors may pick off a few gems, but likely at much lower prices than investors anticipated. Without the opportunity to finance or sell shares, the juniors have little to bargain with. It would seem that the seniors are in the best position to add value...unless gold runs"]
All good & valid points. I completely agree.
MFN was among my first adds. Companies like GG will be in the drivers seat
and will be able to pick up prime assets on the cheap and it's my largest
position and has been for the majority of this cycle.
Fwiw, I'm still 2/3rds majors and only 1/3rd juniors/explorers.
However, some of these marginal juniors and explorers have been beaten up
so badly, that they're worth owning in a speculative basket.
But, one important point that I'd like to reiterate...
I am only adding here with 1/2 of the profits from my short
trade off the trading range turn from HUI 470. And the other half
is safely in the bank.
And you must be short something, if you are long anything,
in this market.
This morning there was about an hour of hesitancy to where the credit
spreads were blowing out on stocks like GS (Great Call Ron!), and it
was a solid risk:reward window of opportunity to get short financials,
if you already weren't.
I added XLF, GS, and also WFC short. GS for all the reasons Ron already
noted... XLF as a broad proxy, and WFC because it was UP! on the day
early, and it's trading at a very rich 2.4 book. That premium can not,
and will not last in this environment.
I also added AMZN short. And I'm already short the DOW
I am hoping that this meltdown causes the Fed to blink and they either
cut rates tomorrow and/or bail out AIG.
Here's the downside:
I talked about how the puppeteers may use Deflation as an offensive
weapon for mass wealth transfer - just like they used it in the Great
Depression.
They let the financial markets melt down. They run Ma & Pa Kettle completely
out of stocks. They collapse global & emerging markets. And then they step in
and snap up China & India on the cheap, consolidate and control the
financial system, and load up on commodities before massively reflating.
DOW 8500, $550 Gold, and $60 Oil.
...that's the risk.
And that just may be their gameplan, and where we're heading.
This AIG meltdown could be a gameplan changer however. As the
puppeteers risk letting this get out of control.
If gold & gold stocks don't get a bid under them tomorrow, I'll have
no compulsion in cutting back my recent adds here and just
letting my LEAPS run in the majors.
If you ever wanted to stop inflation, and commodity speculation
dead in it's tracks... this is how to do it.
Hang on to your shorts people!
...literally
S.O.T.B. |
