Metals: Mini Gold (1 Viewer)
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generali1984
Forumer storico
alan1 ha scritto:Comunque quella scadrà e ti consegneranno il sottostante
non la puoi rollare :argy:
la mia ( 16 anni ) fra poco rolla me
Auguroni alla Signora che ne porta il peso .........in tutti i sensi
e al Papà che freme
ieri sera praticamente in chiusura ho liquidato KGC , ho sempre meno tempo per seguire ,
peccato perchè KGC sale e scende con % da batticuore , ma in questo momento
la borsa è l'ultimo dei miei pensieri
Un Salutone
gipa69
collegio dei patafisici
generali1984 ha scritto:alan1 ha scritto:Comunque quella scadrà e ti consegneranno il sottostante
non la puoi rollare :argy:
la mia ( 16 anni ) fra poco rolla me
Auguroni alla Signora che ne porta il peso .........in tutti i sensi
e al Papà che freme
ieri sera praticamente in chiusura ho liquidato KGC , ho sempre meno tempo per seguire ,
peccato perchè KGC sale e scende con % da batticuore , ma in questo momento
la borsa è l'ultimo dei miei pensieri
Un Salutone
Luisa è nata sabato e gli auriferi continuano a far bene
meglio di così
Ciao Michele e tieni duro
generali1984
Forumer storico
gipa69 ha scritto:Luisa è nata sabato e gli auriferi continuano a far bene
meglio di così
AUGURONIIIIIIIIIIIIIIIIIIIIIIIIIII !
Benvenuta a Luisa
presumo che Luisa prima che leggere e scrivere imparerà a fare grafici
Un Salutone e Tanti Tanti AUGURIIIIIIIIIIIIII
gipa69
collegio dei patafisici
gipa69 ha scritto:
Questo commento lo scrivevo all'apertura del 13/10
Aggiungevo dopo qualche giorno anche NEM.....
Vediamo a che punto sono andati....
Complessivamente una buona performance anche se la parte del leone è stata fatta da GG.. comunque l'impostazione grafica è ancora buona.
gipa69
collegio dei patafisici
JIM PUPLAVA: And you’re listening to the Financial Sense Newshour, where we’re broadcasting from the Marriott Hotel in downtown San Francisco at this year’s San Francisco Hard Assets show. Well, this has been a rather interesting year: we’ve seen a number of companies taken out – some on the junior side, some on the bigger side. To comment on that, joining me is John Doody, he’s Editor of The Gold Stock Analyst. John, is this just a preview of what’s coming ahead, or where are we going with this?
JOHN DOODY: Companies have not spent a lot of money on exploration during the gold market downturn, and I think we’re seeing deposits that were known to exist are coming to the fore. If you’re a company like Newmont or Barrick you’ve got to replace reserves, and it’s very difficult to do that with a drill bit, and it’s cheaper to buy than to find in many cases. [1:00]
JIM: The other thing that surprised me – Ralph Bullis did a study a number of years ago – the number of deposits out there either in the exploration, prefeasibility phase or under development, and the amounts of deposits of 5 million ounces or more – I think it’s been around 17 or 20 is the figure I’ve seen. Then you duck down below that to the 2 and 3 million ounce deposits and it’s surprising, you know, maybe 30 or 40, so you take all the number of gold companies that are out there right now – there isn’t a lot to look for unless you go out and try to discover it yourself.
JOHN: Look at the companies here – most of the companies here at the show are explorers – and really companies I don’t cover because they haven’t got to their feasibility or production stage. But they’ll find things and get taken out like Western Silver did earlier this year – actually Western Silver got taken out twice, because Glamis owned it and then they got taken out by Goldcorp. So good deposits will get found so there are new opportunities but some of these opportunities are in areas that are not so great, with political risk. You’ve got to go where the gold is, you can’t necessarily pick and choose among the countries you’d like to operate in. [2:11]
JIM: You’ve been following the gold market for a long time, what would you say are the characteristics that make this gold bull market different from let’s say in the late 60s or 70s? Certainly the companies are bigger, it takes longer to take a deposit from discovery into production. Are there any other characteristics that you see that would distinguish this market?
JOHN: I think there’s a general shortage of management, and the schools aren’t turning out people. There’s a lack of geologists. There’s a tremendous shortage across the whole industry – not only in materials but in people to do the work. You can have bull markets that are driven just because you can make money at whatever the constant gold price is. In the mid-90s we had a pretty constant gold price in the high 300s, and companies were able to make money at that because their cash costs were roughly half that. And now we’ve got a market that’s more driven – in my opinion – by expectations about what the dollar is going to do; and there’s greater acceptance of gold as an investment, and part of it is due to people like you or the World Gold Council. And in a sense it makes gold a legitimate holding – just listen to CNBC, right? They don’t make jokes about gold anymore. And gold has definitely got a legitimate place in any person’s fund’s portfolio, and I think in a sense this market is driven by companies trying to fill that need for gold investments. So we have a lot more explorers that have come back – and a lot of them are working deposits are already known about 10 years ago. They picked them up when they made sense at these prices when they didn’t before. And even companies like Vista Gold, or Seabridge Gold which has just been really warehouses for deposits have proven that some of these deposits are well worth another look. [4:02]
JIM: You also have a situation today where the price is high enough where you have companies like Silver Standard that are finally saying, “you know, we’ve been warehousing this stuff, it’s time to take it into production.”
JOHN: Yes, I’m not so sure that’s a good move because producing is very nasty and dirty and full of surprises. It’s a lot nicer just to be a clean warehouse and operating without their production headaches. But we’ll see if it’s successful or not. There’s no question that Silver Standard is a great success story, whether it really makes sense for them to change their spots or not, I don’t know. [4:34]
JIM: Let’s talk about the cost structure – that is certainly different today. I mean if you take a look at the oil industry where they’ve been experiencing 35% cost inflation, and if you look at all of the money that’s been put into oil exploration, factor out inflation, and I think the IEA said it’s only been a real input of about 5%. Let’s talk about cost structures on the mining side, because even though we’ve seen the price of gold now at 600, we’ve also seen correspondingly a large increase in costs.
JOHN: Well, the rule of thumb in mining is that energy use is about 25% of your cash cost to produce. So if you’re operating at $300 cash cost an ounce, that’s roughly $75 an ounce just in energy cost. And we’ve seen companies doing all kinds of things to try to mitigate that –Barrick and Newmont have both built big power plants in Nevada to cut their operating cash cost; and companies are really struggling with this. But it’s also coming through in labor costs because there aren’t a lot of skilled miners around and miners can travel, they can go to where the better jobs are; and the schools are not turning out enough good people. I understand that a starting geo can get – somebody with a graduate degree in geology, Masters degree – can basically name his own price and 60 to $70,000 a year to start. And that’s evidence of a shortage. [6:05]
JIM: And that’s something that’s unlikely to go away any time soon, because it takes four years to get a degree and we don’t have as many mining schools today as we did say two decades ago.
JOHN: Right, and nobody thinks about wanting to be a miner the way they used to, even at places that are historically mining oriented – Canada, for example, much more mining oriented that the States. Well, maybe they are now, but they haven’t been generating enough students to come out and work in the industry. Yeah, it’s going to be a long term shortage but it’ll get filled. You know, people want to go where the jobs are and when they get educated they’re going to want to get a job when they get out. What was the quote that Jack Welch former head of GE that said that there were more sports medicine graduates in the United States than there are electrical engineers in one of the recent years. Well, that will change. [7:03]
JIM: Let’s talk about Gold Stock Analyst, what it is that you do and the type of companies that you put in and your top 10 news list – talk about that for a moment.
JOHN: As you know, Jim, my background is as a former economics professor and I’m not a geologist. And the way that I look at the industry is that I want companies to analyze that can prove that they have what they’ve got. So I look for companies that have at least a feasibility study which is an independent assessment which is sort of like the way an independent accounting firm approves a company’s accounting statements. I look for a company with at least an independent feasibility study which shows at least the drilling that they’ve done is verified and that the ounces that they can mine there can be done profitably – economically. And so that means I’m sort of in the larger group of companies – although some of them are not producers, they’re near production. And then I go on all the way up to the very top – to the biggest guys like the Barricks, the Newmonts and Anglo Golds and so forth.
And what interested me about this industry is that it’s unique in the sense that everybody makes the same thing. There’s no difference between a Barrick gold ounce and a Newmont gold ounce, but yet their stock prices sell all over the place, they have different amounts of production, different amounts of reserves. And who is a good buy and who isn’t a good buy; who’s overvalued and who’s undervalued? And when you have 60 companies to look at as I do you can find that there are basic parameters that establish value in the industry. There may be reasons why a company’s ounces are worth more than somebody else’s. There may be a reason why a company’s should be worth less, but you can make a subjective decision. And in my opinion, if you’re trying to find out who is undervalued you have to understand how the industry itself is valued. So we do a lot of work with this concept of market capitalization per ounce of reserves, per ounce of production – where you take the ounces, you take the stock price times the number of shares, and you divide that by the number of ounces a company produces, or the number of ounces it has in reserve. And that gives you a number that you can compare to other companies and the industry in general. [9:08]
JIM: If you were doing this newsletter, let’s say, the last bull market – you know, the type of companies that were around back then, if you were a producer producing around ½ million ounces that was considered a major company. If you look at the yardsticks and the benchmarks today where you have the Barricks, you have the Newmonts, you have the Gold Fields – I mean those yard sticks have moved considerably. And yet, if you’re a Newmont, if you’re a Barrick, other than buying somebody else, how do you replace those?
JOHN: Well, you spend a lot of money on drilling and exploration. And both of those companies are spending over $100 million a year on exploration. But you can’t predictably find ounces every year, you don’t know that that 100 million you spent is going to pay off with what you need. And you need to not only replace the ounces that you’ve used up but because you get losses in recovery you’ve actually got to find more ounces. So if Barrick is going to produce 6 million ounces next year they’ve probably going to find 7 ½ million ounces due to processing waste. So that’s a huge thing – that’s basically almost an impossibility to replace those kind of ounces on an ongoing, consistent basis just from drilling. You’ve got to do acquisitions. [10:26]
JIM: You know this reminds me of the tech market, if you were to look at the technology stocks in 91 and 92, if you invested money in an IBM you made money in that decade – certainly beating the market. But the real money was made in buying a Cisco or a Dell or somebody that could grow their sales aggressively – and it seems like in this market, if we take the market: the IBMs are your Newmonts, and your Barricks; but your Dells and your Ciscos are going to be more of like your Goldcorp, your Yamanas, or companies that can sit there and start out at 100 to 200,000 and build up to a million ounce production profile.
JOHN: I agree – that’s really where the upside is – we don’t have Barrick or Newmont on our top 10; and we do have Goldcorp and Yamana, and other companies too. It’s hard to find companies though that have the real potential to grow from 100,000 ounces to on up there – Goldcorp has been on our top 10 list three different times. First it went on there at 4 or 5 bucks when it was just the Red Lake mine; it went off when we thought it was overvalued, and it comes back on but it’s a new Goldcorp – it’s not the same one as it was before. And now with Glamis it’s back on – we put it on at $23, and I think it’s a $40 or $50 stock long term. It’s a unique new major that’s in the mix here now that’s going to be producing by the time 2010 comes along which isn’t that far away, and it’s Penasquito deposit in Mexico comes on which is a gold deposit but also a big silver producer and base metals – the byproducts there are going to allow it to deliver 4 or 500,000 ounces a year gold at a negative cash cost. And that plays right into the whole theme in this market in my opinion: if you can get your cash cost reporting down around zero you’re going to get a premium valuation for your company. And that’s basically what Goldcorp has done and Agnico-Eagle has done it, Meridian has done it, Yamana is going to be the next one in that group to do it when it’s Chapada mine is fully online at the beginning of next year. And that’s part of the theme, it’s not only production growth but production growth at low cost. And that’s what makes some of these combination producers attractive that have a gold production and a by-product – whether it’s silver, whether it’s copper or whatever. If you can lower your cash costs the market rewards that. And they don’t really care how you lower them, or they don’t really care that it’s a base metal – they’re willing to pay extra valuation for the fact that you get your cash costs down so low. [13:08]
JIM: Finally, John, let’s talk about your newsletter, I’m a paid up subscriber, or at least I think I am.
JOHN: I think you are. I appreciate it, thank you.
JIM: So you cover 60 different companies, you feature almost like a Value Line report – you take these companies and you do a nice analysis of them. Tell our listeners a little bit more about your newsletter. And I might point out, it is subscriber supported only – you don’t take money from companies or anything like that, that would color your judgment.
JOHN: And that makes us expensive. We’re $395 a year, but it’s purely supported by subscribers – companies don’t pay (some subscribe, some don’t, it doesn’t matter). There’s no warrants; there’s no payment for reprints. If a company has said they want to reprint we don’t charge them, we just let them do it – there’s no subscription form attached to that if you just want to send it out kind of thing (as I just saw somebody do recently). So it lets us be pure and I tell it like it is, and since we’re not involved with investment banking I can say things that the brokerage analysts can’t say, and I can piss people off – can I say that?
JIM: Go ahead.
JOHN: And you know, there are stocks I don’t like, and I don’t like the management and people know that. But in any case, what we try to do is this kind of comparative evaluation – we look for stocks that are undervalued versus there peers. And sometimes there’s a good reason for that in which case we don’t want to recommend it, but sometimes the market is wrong – the market is not efficient, everybody isn’t valued properly all the time. And our track record shows the top 10 is up 80% so far this year. And over the 12 years now that we’ve been writing if you take the gain over that 12 years, the average gain was 28% a year, which is a pretty good track record. And we run it like a mutual fund. And I think one mistake investors make - particularly in gold stocks – is they fall in love with stories: they come to these conventions; they meet top management; they think these guys are brilliant; they already own 15 gold stocks, so they say they’re going to buy one more because I like this story. What happens is you own so many stocks that you simply are the market. Your return becomes the market return. What you want to do is beat the average return. So one way that we do that is we focus on 10 stocks. If we want to add another stock we’ve got to kick somebody out – so is company 11 better than the 1 through 10 we already have? With that said we’re only actually the top 9 now because we took off Kinross from the top 10 list because we didn’t like the Bema in it, so with that possibility we’re looking around the show here just like you are for another stock to buy. [15:52]
JIM: John, if our listeners would like to find out more about your newsletter tell us how they can do so.
JOHN: Well, that’s easy. We have a website – www.goldstockanalyst.com – there’s a sample issue, a very nice endorsement from Bill Fleckenstein. You can print off lots of stuff to read: a user’s guide to GSA which is 24 pages which is there free; and our track record, we also publish that.
JIM: Alright, well, John, thanks for joining us.
JOHN: My pleasure, Jim. Thanks for having me. [16:26]
JOHN DOODY: Companies have not spent a lot of money on exploration during the gold market downturn, and I think we’re seeing deposits that were known to exist are coming to the fore. If you’re a company like Newmont or Barrick you’ve got to replace reserves, and it’s very difficult to do that with a drill bit, and it’s cheaper to buy than to find in many cases. [1:00]
JIM: The other thing that surprised me – Ralph Bullis did a study a number of years ago – the number of deposits out there either in the exploration, prefeasibility phase or under development, and the amounts of deposits of 5 million ounces or more – I think it’s been around 17 or 20 is the figure I’ve seen. Then you duck down below that to the 2 and 3 million ounce deposits and it’s surprising, you know, maybe 30 or 40, so you take all the number of gold companies that are out there right now – there isn’t a lot to look for unless you go out and try to discover it yourself.
JOHN: Look at the companies here – most of the companies here at the show are explorers – and really companies I don’t cover because they haven’t got to their feasibility or production stage. But they’ll find things and get taken out like Western Silver did earlier this year – actually Western Silver got taken out twice, because Glamis owned it and then they got taken out by Goldcorp. So good deposits will get found so there are new opportunities but some of these opportunities are in areas that are not so great, with political risk. You’ve got to go where the gold is, you can’t necessarily pick and choose among the countries you’d like to operate in. [2:11]
JIM: You’ve been following the gold market for a long time, what would you say are the characteristics that make this gold bull market different from let’s say in the late 60s or 70s? Certainly the companies are bigger, it takes longer to take a deposit from discovery into production. Are there any other characteristics that you see that would distinguish this market?
JOHN: I think there’s a general shortage of management, and the schools aren’t turning out people. There’s a lack of geologists. There’s a tremendous shortage across the whole industry – not only in materials but in people to do the work. You can have bull markets that are driven just because you can make money at whatever the constant gold price is. In the mid-90s we had a pretty constant gold price in the high 300s, and companies were able to make money at that because their cash costs were roughly half that. And now we’ve got a market that’s more driven – in my opinion – by expectations about what the dollar is going to do; and there’s greater acceptance of gold as an investment, and part of it is due to people like you or the World Gold Council. And in a sense it makes gold a legitimate holding – just listen to CNBC, right? They don’t make jokes about gold anymore. And gold has definitely got a legitimate place in any person’s fund’s portfolio, and I think in a sense this market is driven by companies trying to fill that need for gold investments. So we have a lot more explorers that have come back – and a lot of them are working deposits are already known about 10 years ago. They picked them up when they made sense at these prices when they didn’t before. And even companies like Vista Gold, or Seabridge Gold which has just been really warehouses for deposits have proven that some of these deposits are well worth another look. [4:02]
JIM: You also have a situation today where the price is high enough where you have companies like Silver Standard that are finally saying, “you know, we’ve been warehousing this stuff, it’s time to take it into production.”
JOHN: Yes, I’m not so sure that’s a good move because producing is very nasty and dirty and full of surprises. It’s a lot nicer just to be a clean warehouse and operating without their production headaches. But we’ll see if it’s successful or not. There’s no question that Silver Standard is a great success story, whether it really makes sense for them to change their spots or not, I don’t know. [4:34]
JIM: Let’s talk about the cost structure – that is certainly different today. I mean if you take a look at the oil industry where they’ve been experiencing 35% cost inflation, and if you look at all of the money that’s been put into oil exploration, factor out inflation, and I think the IEA said it’s only been a real input of about 5%. Let’s talk about cost structures on the mining side, because even though we’ve seen the price of gold now at 600, we’ve also seen correspondingly a large increase in costs.
JOHN: Well, the rule of thumb in mining is that energy use is about 25% of your cash cost to produce. So if you’re operating at $300 cash cost an ounce, that’s roughly $75 an ounce just in energy cost. And we’ve seen companies doing all kinds of things to try to mitigate that –Barrick and Newmont have both built big power plants in Nevada to cut their operating cash cost; and companies are really struggling with this. But it’s also coming through in labor costs because there aren’t a lot of skilled miners around and miners can travel, they can go to where the better jobs are; and the schools are not turning out enough good people. I understand that a starting geo can get – somebody with a graduate degree in geology, Masters degree – can basically name his own price and 60 to $70,000 a year to start. And that’s evidence of a shortage. [6:05]
JIM: And that’s something that’s unlikely to go away any time soon, because it takes four years to get a degree and we don’t have as many mining schools today as we did say two decades ago.
JOHN: Right, and nobody thinks about wanting to be a miner the way they used to, even at places that are historically mining oriented – Canada, for example, much more mining oriented that the States. Well, maybe they are now, but they haven’t been generating enough students to come out and work in the industry. Yeah, it’s going to be a long term shortage but it’ll get filled. You know, people want to go where the jobs are and when they get educated they’re going to want to get a job when they get out. What was the quote that Jack Welch former head of GE that said that there were more sports medicine graduates in the United States than there are electrical engineers in one of the recent years. Well, that will change. [7:03]
JIM: Let’s talk about Gold Stock Analyst, what it is that you do and the type of companies that you put in and your top 10 news list – talk about that for a moment.
JOHN: As you know, Jim, my background is as a former economics professor and I’m not a geologist. And the way that I look at the industry is that I want companies to analyze that can prove that they have what they’ve got. So I look for companies that have at least a feasibility study which is an independent assessment which is sort of like the way an independent accounting firm approves a company’s accounting statements. I look for a company with at least an independent feasibility study which shows at least the drilling that they’ve done is verified and that the ounces that they can mine there can be done profitably – economically. And so that means I’m sort of in the larger group of companies – although some of them are not producers, they’re near production. And then I go on all the way up to the very top – to the biggest guys like the Barricks, the Newmonts and Anglo Golds and so forth.
And what interested me about this industry is that it’s unique in the sense that everybody makes the same thing. There’s no difference between a Barrick gold ounce and a Newmont gold ounce, but yet their stock prices sell all over the place, they have different amounts of production, different amounts of reserves. And who is a good buy and who isn’t a good buy; who’s overvalued and who’s undervalued? And when you have 60 companies to look at as I do you can find that there are basic parameters that establish value in the industry. There may be reasons why a company’s ounces are worth more than somebody else’s. There may be a reason why a company’s should be worth less, but you can make a subjective decision. And in my opinion, if you’re trying to find out who is undervalued you have to understand how the industry itself is valued. So we do a lot of work with this concept of market capitalization per ounce of reserves, per ounce of production – where you take the ounces, you take the stock price times the number of shares, and you divide that by the number of ounces a company produces, or the number of ounces it has in reserve. And that gives you a number that you can compare to other companies and the industry in general. [9:08]
JIM: If you were doing this newsletter, let’s say, the last bull market – you know, the type of companies that were around back then, if you were a producer producing around ½ million ounces that was considered a major company. If you look at the yardsticks and the benchmarks today where you have the Barricks, you have the Newmonts, you have the Gold Fields – I mean those yard sticks have moved considerably. And yet, if you’re a Newmont, if you’re a Barrick, other than buying somebody else, how do you replace those?
JOHN: Well, you spend a lot of money on drilling and exploration. And both of those companies are spending over $100 million a year on exploration. But you can’t predictably find ounces every year, you don’t know that that 100 million you spent is going to pay off with what you need. And you need to not only replace the ounces that you’ve used up but because you get losses in recovery you’ve actually got to find more ounces. So if Barrick is going to produce 6 million ounces next year they’ve probably going to find 7 ½ million ounces due to processing waste. So that’s a huge thing – that’s basically almost an impossibility to replace those kind of ounces on an ongoing, consistent basis just from drilling. You’ve got to do acquisitions. [10:26]
JIM: You know this reminds me of the tech market, if you were to look at the technology stocks in 91 and 92, if you invested money in an IBM you made money in that decade – certainly beating the market. But the real money was made in buying a Cisco or a Dell or somebody that could grow their sales aggressively – and it seems like in this market, if we take the market: the IBMs are your Newmonts, and your Barricks; but your Dells and your Ciscos are going to be more of like your Goldcorp, your Yamanas, or companies that can sit there and start out at 100 to 200,000 and build up to a million ounce production profile.
JOHN: I agree – that’s really where the upside is – we don’t have Barrick or Newmont on our top 10; and we do have Goldcorp and Yamana, and other companies too. It’s hard to find companies though that have the real potential to grow from 100,000 ounces to on up there – Goldcorp has been on our top 10 list three different times. First it went on there at 4 or 5 bucks when it was just the Red Lake mine; it went off when we thought it was overvalued, and it comes back on but it’s a new Goldcorp – it’s not the same one as it was before. And now with Glamis it’s back on – we put it on at $23, and I think it’s a $40 or $50 stock long term. It’s a unique new major that’s in the mix here now that’s going to be producing by the time 2010 comes along which isn’t that far away, and it’s Penasquito deposit in Mexico comes on which is a gold deposit but also a big silver producer and base metals – the byproducts there are going to allow it to deliver 4 or 500,000 ounces a year gold at a negative cash cost. And that plays right into the whole theme in this market in my opinion: if you can get your cash cost reporting down around zero you’re going to get a premium valuation for your company. And that’s basically what Goldcorp has done and Agnico-Eagle has done it, Meridian has done it, Yamana is going to be the next one in that group to do it when it’s Chapada mine is fully online at the beginning of next year. And that’s part of the theme, it’s not only production growth but production growth at low cost. And that’s what makes some of these combination producers attractive that have a gold production and a by-product – whether it’s silver, whether it’s copper or whatever. If you can lower your cash costs the market rewards that. And they don’t really care how you lower them, or they don’t really care that it’s a base metal – they’re willing to pay extra valuation for the fact that you get your cash costs down so low. [13:08]
JIM: Finally, John, let’s talk about your newsletter, I’m a paid up subscriber, or at least I think I am.
JOHN: I think you are. I appreciate it, thank you.
JIM: So you cover 60 different companies, you feature almost like a Value Line report – you take these companies and you do a nice analysis of them. Tell our listeners a little bit more about your newsletter. And I might point out, it is subscriber supported only – you don’t take money from companies or anything like that, that would color your judgment.
JOHN: And that makes us expensive. We’re $395 a year, but it’s purely supported by subscribers – companies don’t pay (some subscribe, some don’t, it doesn’t matter). There’s no warrants; there’s no payment for reprints. If a company has said they want to reprint we don’t charge them, we just let them do it – there’s no subscription form attached to that if you just want to send it out kind of thing (as I just saw somebody do recently). So it lets us be pure and I tell it like it is, and since we’re not involved with investment banking I can say things that the brokerage analysts can’t say, and I can piss people off – can I say that?
JIM: Go ahead.
JOHN: And you know, there are stocks I don’t like, and I don’t like the management and people know that. But in any case, what we try to do is this kind of comparative evaluation – we look for stocks that are undervalued versus there peers. And sometimes there’s a good reason for that in which case we don’t want to recommend it, but sometimes the market is wrong – the market is not efficient, everybody isn’t valued properly all the time. And our track record shows the top 10 is up 80% so far this year. And over the 12 years now that we’ve been writing if you take the gain over that 12 years, the average gain was 28% a year, which is a pretty good track record. And we run it like a mutual fund. And I think one mistake investors make - particularly in gold stocks – is they fall in love with stories: they come to these conventions; they meet top management; they think these guys are brilliant; they already own 15 gold stocks, so they say they’re going to buy one more because I like this story. What happens is you own so many stocks that you simply are the market. Your return becomes the market return. What you want to do is beat the average return. So one way that we do that is we focus on 10 stocks. If we want to add another stock we’ve got to kick somebody out – so is company 11 better than the 1 through 10 we already have? With that said we’re only actually the top 9 now because we took off Kinross from the top 10 list because we didn’t like the Bema in it, so with that possibility we’re looking around the show here just like you are for another stock to buy. [15:52]
JIM: John, if our listeners would like to find out more about your newsletter tell us how they can do so.
JOHN: Well, that’s easy. We have a website – www.goldstockanalyst.com – there’s a sample issue, a very nice endorsement from Bill Fleckenstein. You can print off lots of stuff to read: a user’s guide to GSA which is 24 pages which is there free; and our track record, we also publish that.
JIM: Alright, well, John, thanks for joining us.
JOHN: My pleasure, Jim. Thanks for having me. [16:26]