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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: regli who wrote (49817)	1/15/2006 5:41:32 PM
From: glenn_a	Respond to of 110194

You're most welcome regli. A couple additional points: 1 - In a credit bust, there will still be many periods where cash in strong currencies is king, and speculative capital flows into gold and PM equites reverse. I really liked Russ's comment that PM juniors trade like options, and their valuations are very sensitive to speculative capital flows. 2 - As a rhyme on Donald Coxe's theme that long-life energy reserves in "geopolitically secure regions of the world" deserve a higher valuation premium, I am currently weighted towards long-life PM reserves in secure areas of the world (CLG is currenly my largest PM holding). For example, there is a strong trend in Latin America to reject the IMF-led Washington consensus, and I personally don't feel it is entirely socially just for absent PM landowners so-to-speak, to reap the benefits of raw material reserves in developing countries, when such profits could go into developing local health care and education infrastructure (for example). This doesn't necessarily mean that mines in such countries will be nationalized, although that is certainly a possibility. However, to my mind it does mean that windfall profits may (and probably should) be significantly taxed so that cash flows can in part go to investing in infrastracture that benefits the local population. And Latin America is at least in the US's geopolitical backyard. As for speculative mining plays in Mongolio or Khazakistan, well, you pays your money, and you takes your chances. :) JM2C worth. Glenn