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To: pater tenebrarum who wrote (85873)	10/3/2001 10:46:27 PM
From: Paul Shread	Read Replies (1) \| Respond to of 86076

>>anyone else see the rising wedge on the SnP 60 min. chart?<< Yup, but I'm told that America has rolled up its sleeves and gone back to work, so we should get over it, the bottom's in. Nonetheless, that sure doesn't look good, and right at resistance, too. Add to that the fact that we are almost exactly at the break-even point for SPX investments since 1995 (1084). Get me out! I'm even! <ggg> cache.wsrn.com The Dow did a little damage to its wedge, however; last saw that on the way up in April, so it makes me nervous. This breakout doesn't look as bullish, though, and it took too much effort (overbought indicators) to break through: cache.wsrn.com Got this email tonight; any thoughts? "Check out some of the supply demand ratios. Still a lot more buybacks than new issuances being announced. We may still have a ways to run after a rest. Buybacks will put a floor under this thing, whereas it will take some awfully unexpected bad news to shake out any more long term sellers."

To: pater tenebrarum who wrote (85873)	10/4/2001 7:52:40 AM
From: re3	Read Replies (1) \| Respond to of 86076

The metal no one understands Palladium market a wild ride for investors, miners Drew Hasselback Financial Post LAC DES ILES, Ont. - For decades, local prospectors have wondered whether palladium would eventually be mined from this deposit 85 kilometres northwest of Thunder Bay. Ideas and plans came and went over the decades. About two years ago, palladium prices began to pick up speed and North American Palladium Ltd. put together the financing that made the project happen. Local dignitaries gathered at the mine site on Aug. 29 for the official ribbon cutting. Keith Minty, president and chief executive of North American, said a few words. Politicians politely reminded the voters how their actions helped make the dream reality. A Psalm was read. Fred Joseph Colli, Bishop of Thunder Bay, blessed the mine with a prayer. Then the mine was officially opened and the project's future was officially left in the hands of God and metal speculators. Palladium prices have gone for a dazzling ride. Last January, palladium went for almost US$1,200 an ounce, nearly triple the price from a year earlier. Prices have fallen just as rapidly. Spot prices for palladium are down more than 70% from January. Spot prices in London fell 12% on Monday, the metal's biggest one-day drop in more than five years. The metal last traded on the London Metal Exchange at US$350. Palladium is primarily used as an active ingredient in catalytic converters, devices that cut the pollution coming out of car tailpipes. According to consultants at Johnson Matthey, about 62% of the 9.1 million ounces of palladium produced in 2000 were used as autocatalysts. Demand in the auto business is expected to be weak as General Motors Corp., Ford Motor Co. and DaimlerChrysler AG are likely to have their worst sales year since 1992. Yet North American is undeterred by the economic slowdown. "Palladium is the metal of choice for the manufacture of these converters," said Keith Minty, president and chief executive of North American. "In the not-too-distant future, every car manufactured in the world will carry a catalytic converter." Other uses include electronics, which accounted for 21% of demand, and dentistry, at 12%. Smaller markets include chemical production and jewellery manufacturing. The palladium world is relatively small. This sets the stage for the wild price swings, particularly when inexperienced traders gamble on the metal's future. Prices are also jarred when producers from Russia, the world's largest palladium supplier, releases big shipments on the market. "Palladium? No one knows anything about palladium," said David Mallalieu, gold and precious metals analyst with Scotia Capital. "Everyone knows something about gold. That's reflected in the markets. Gold is liquid. It trades pretty well. Palladium doesn't." That means producers have to keep costs low in order to be ready for periods of weak pricing. This posed an interesting challenge for North American. The Lac des Îles mine is actually a low grade property, which means that miners have to dig up a lot of rock and the mill has to process a lot of rumble before palladium concentrate is shipped out on trucks. The property grades two to three grams of palladium per tonne of rock. By comparison, the Stillwater Mining Co.'s property in Montana is this year recovering about 15 grams of palladium per tonne. But while it is usually easier to make money with a higher grade property, North American is convinced it will make its $220-million operation pay. "I've been in this business for 30 years. This is the most economically viable mine I have ever seen," said Stephen Stine, vice-president and general manager of the mine. At full capacity, which should be reached by the end of the year, North American will be able to churn out 250,000 ounces of palladium a year. While cash production costs in the second quarter were $274 an ounce, North American aims to lower this to $160 after the mine reaches full capacity. Assuming North American keeps costs under control, the company's next challenge is to make money in a highly volatile pricing environment. Stillwater and North American are the continent's only major palladium suppliers. After that, buyers have to rely on producers from Russia. Metal speculators jumped on the bandwagon in early 2001, expecting automakers to lap up supply from the new North American producers. They also rolled the dice that new environmental regulations would increase demand for palladium as an autocatalyst. What speculators were not able to foresee is that automakers understand the market very well and they know when to stock up when prices are low and use up inventories when prices are high. That is why high prices came down so fast -- palladium priced itself out of the market. Besides, speculators also failed to understand that palladium may not be the only option in the autocatalyst market. "Whatever their views towards stocks, the response by automakers worldwide to the record levels of the palladium price in the latter half of 2000 is clear -- they wish to reduce their dependence on the metal if at all possible," states a market analysis by Johnson Matthey. Those closer to the industry have avoided the market's wild swings by signing long-term supply contracts at stable prices. North American, for example, has signed a five-year contract to sell its entire production to an unnamed U.S. auto producer at a floor price of US$325 an ounce for 100% of production. Franco-Nevada Mining Corp. Ltd., no stranger to profit in the mining industry, have invested in the Stillwater property in return for a claim 5% of the mine's revenue. "Anybody involved in long term production will tell you that at the rate you can take it out of the ground and you can sell it, there's money to be made. Very reliably," said Sharon Dowdall, general counsel for Franco-Nevada.

To: pater tenebrarum who wrote (85873)	10/4/2001 7:59:44 AM
From: re3	Read Replies (1) \| Respond to of 86076

Franco-Nevada urges better offer for Normandy Not official rejection Drew Hasselback Financial Post Peter Redman, National Post Pierre Lassonde, co-chairman of Franco-Nevada, left, expected his stake to grow to A$1.75 to A$2 a share. Franco-Nevada Mining Corp. Ltd., has suggested AngloGold Ltd. sweeten its US$2.3-billion bid for Normandy Mining Ltd. of Australia. Toronto-based Franco-Nevada, which bought a 19.9% stake in Normandy in May, said yesterday it wants AngloGold to raise its bid price as high as A$2 ($1.55), up from AngloGold's current proposal of A$1.44. Pierre Lassonde, co-chief executive of Franco-Nevada, sought the sweetener during a presentation to mining analysts and investors at the Denver Gold Group's Mining Investment Forum, an annual gathering of the world's largest gold firms. "Our original plan was that, after some restructuring, we could see our stake worth A$1.75 to A$2 a share in one year," Mr. Lassonde said. AngloGold has yet to mail a formal offer to shareholders. That means Franco-Nevada's hope for a sweetener is not an official rejection of the AngloGold offer. The plan was to use the Denver conference to drop a not so subtle hint about how much Franco-Nevada thinks its Normandy stake is really worth. Gold prices rose to a 19-month high last week. Given other recent mergers, such as Barrick Gold Corp.'s proposed purchase in June of Homestake Mining Co. for about US$2.4-billion, AngloGold is under pressure to conclude a major deal. "They're hoping that everyone will talk to everyone else and cause something to happen," said Sharon Dowdall, Franco-Nevada's general counsel. Steve Lenahan, an AngloGold spokesman, said it would consider upping its offer only if there were "material changes to circumstances." "As things stand we continue to believe that the offer to Normandy's shareholders is full and fair." Franco-Nevada has identified the gold sector as ripe for industry consolidation. The company's stated strategy is to acquire significant investments in a variety of gold mining companies. The idea is not to buy a controlling stake in companies, but rather hold enough stock to influence the direction of a company either by winning seats on its board or holding enough votes to support or kill takeover offers. The Normandy deal puts this "king maker" role to the test. Mr. Lassonde used the mining conference to put the best spin on the company in hopes of attracting alternative bids. "Whoever ends up getting Normandy is going to be the premier gold company in the world for the next 10 years simply because of the reserves, the production and the political risk balance that Normandy provides," he said. Franco-Nevada acquired its 19.9% stake in Normandy when it sold the Ken Snyder mine to Normandy in exchange for US$48-million and 446.1 million Normandy shares. Even at the A$1.44 price, the AngloGold bid means Franco-Nevada has already made a paper profit of $185-million on its four-month investment. John Ing, president of Maison Placements Canada Inc, said he estimates Franco-Nevada's stake in Normandy should be worth about A$1.75. "It was well expected Franco-Nevada would be looking for a sweetener," he said. "There's a lot of room for some bartering, some swapping of assets, and some dealing here. I think the announcement by Franco at the Denver Gold Show is just the beginning of the game."