Could the “Fourth Element” Make You a Fortune?

Beryllium stock teaser from Byron King solved

By gumshoe, September 14, 2011

Byron King is pitching another teensy weensy rare metals stock for his Energy & Scarcity Investor newsletter from Agora, only this time it’s not the rare earth metals but a really light metal that he calls the “Fourth Element.”

Which brings to mind several of the periodic table-focused teasers of years past, though particularly the breathless pitches about the “fight for the third element” — and yes, if you take a gander at the periodic table they are indeed talking about real and useful industrial metals, the third element is lithium, which has been the focus of many a battery-focused tease as newsletters forecast the era of the electric automobile; and the fourth element, as you might remember from high school, is beryllium. Beryllium, as we are teased by Mr. King, is prized for its light weight, low density, high rigidity, among other things, and is very toxic as a dust but also very valuable as an alloy component, particularly in aerospace applications where light weight and strength are critical.

So Byron King takes us on a long adventure along with the air force and talks about his days as a carrier pilot and mentions the incredible innovations, like drone bombers and long-range reconnaisance, that beryllium and rare earth elements make possible in the defense sector. You can listen if you like — since it was clear partway through what he was talking about, and I’ve heard much the same pitch before, I got a wee bit bored and skipped ahead.

So what is the company he’s pitching as his beryllium play? Well, here’s a taste of the pitch …

“… this small Canadian company has discovered a way to manipulate ‘The Fourth Element’s’ unique properties to make it strengthen and lighten satellites and space structures, aircraft, optical systems, semiconductors, medical imaging and nuclear systems.

“As the story up above demonstrates, this explosive Canadian company’s new ‘super metal’ technology… with ‘The Fourth Element’ and aluminum as its main components… could become an essential element in gun sights, rocket launch rails and guidance systems.

“In fact, this ‘super metal’ technology can be used in an incredible array of different areas… including nuclear, aerospace, defense, telecom, computing, electronics, medical, automotive, oil & gas, and many more…

“Already, this tiny company holds several high-end patents and trade secrets for manufacturing this revolutionary product.

“And this savvy company has also acquired the rights to mineralized properties in two Western U.S. states and Brazil… so they can provide their own “fourth element” metal to their production line.”

And no, I don’t know why they insist on putting “The Fourth Element” in quotes — it is, after all, really the fourth element and they generally only trot out the quotation marks when they’re dissembling or making stuff up.

But regardless, if you’ve been paying attention here at Stock Gumshoe for the past few weeks this is no doubt starting to sound familiar. And if I throw in some more other clues like these …

“This penny stock is currently priced under 22-cents a share and has a tiny market cap of under $42 million…

“So once the news leaks out about this tiny Canadian company’s revolutionary “super metal” breakthrough, you could see this company’s stock price soar 10-fold or more…

“Because the fact is, it would only take a tiny chunk of the defense budget’s $707 billion spending spree to well exceed this Canadian company’s small $42 million market cap.

“And as you’ll see in just a moment, this fast-growing company already has secured some important government contracts and brought onboard a retired General to facilitate even more lucrative government contracts.”

… well, then you’re just going to know right off the bat that Byron King is teasing the same company that Nick Hodge teased for his Alternative Energy Speculator just last month, IBC Advanced Alloys (IB on the Venture exchange in Toronto, IAALF on the pink sheets, where it has an “enhanced listing” on the OTCQX that gives a little extra vote of confidence in their reporting).

And no, not much has happened, news-wise, for IBC in the last month — they got their OTCQX listing with the pink sheets, they got some ho-hum drilling permits for one of their properties (they’re teensy and get much of their revenue from selling machined stuff and alloys, but aim to become vertically integrated by exploring for and developing beryllium mines in Brazil and the US), but I didn’t see anything that seemed to be of consequence other than, this week, a filing for an additional capital raise that, though it sounds small ($5-8 million), will dilute existing shareholders a bit more — so it seems likely that this additional bit of dilution helped to bring the share price down from the recent highs (highs that were, in part, probably provoked by previous teasers from other newsletters).

Of course, with a stock this tiny (thanks to a fall over the last couple weeks it’s now more like a $30 million company, at about 17 cents), $5 million starts to sound like more money — and you don’t need any news to make a little fella like IBC get all jitter-buggy.

There was a long discussion among readers who know a lot more about beryllium than I do back in that first article, so if you’d like a start on digging into more info I’d start there. The stock does have sales and a prominent role in their tiny sector, but certainly doesn’t have profits yet. They’ve done quite a bit of dilution to expand over the last couple years, with new facilities and an acquisition, so I don’t know what their path to per-share profitability looks like or how long it will be.

IBC has also been touted by newsletters before, including previously by the Alternative Energy Speculator folks back in February 2010 — and from my look at the charts, previous touts of the stock by newsletters have been successful in driving the shares up. That isn’t surprising for a tiny stock and a newsletter industry that can make anything sound great in its emails to millions of eager readers, but, in a pattern that we often see repeated for teeny stocks that get the attention of big newsletters, the company hasn’t followed through with enough good news or happy vibes to let the shares stay high and most of these tout-driven highs have gradually waned. Maybe this time it will be different, the company has come some way and they are pretty good at selling their story, but it’s still a tiny stock that can move by 20% if one trader sneezes on his keyboard, so be careful. If you’ve got a thought or two left to share on beryllium or IBC I’m sure we’d all like to hear it — that’s why we’ve got that friendly little comment box down below.

P.S. A curious note for you: IBC is small enough that they use little niche brokers to sell stock — and for this latest offering they’ve hired none other than Euro Pacific Canada, which is the Canadian affiliate of Peter Schiff’s brokerage firm. I wonder if future editions of Euro Pac’s newsletter will pitch IBC to their clients? It doesn’t meet their typical criteria of paying a good dividend or being divorced from the dollar very well (their production and sales seem to be mostly in the US, despite their Canadian listing), but I suppose you never do know …


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35 Comments on "Could the “Fourth Element” Make You a Fortune?"

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Geoff
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Geoff
September 14, 2011 6:18 pm

Can't be bothered to listen to any more crap about tiny stocks that are about to rocket. All complete and utter nonsense 99% of the time. The people that peddle this stuff are just part and parcel of the entire stockmarket scam. There are those that that prey on us by recomending stocks. Then those that prey on us in the stockmarket. itself. It's way past time that they were all exposed or hung.

Lewis Nicholson
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Lewis Nicholson
September 14, 2011 6:32 pm

I'm with you Geoff…bring on the rope

MortT
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MortT
September 14, 2011 8:48 pm

Speaking of pitches to make us millionnaires, Agora has a particularly nasty one about "If my research, travels and interviews prove correct – this is the last stock you might ever need", which includes several bio-pharmas in early stages, one of which has just been approved for Phase 1 Testing. As the owner of a pharma which has had Phase 3 Testing for about 10 years, I know that this is unconscionable.
Mort T..

Yola
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Yola
October 27, 2012 6:11 am

It’s a good that you said 99% leaving at least 1% to work with, go easy on you dismissal platform remember the present day giants like Wall Mart,Apple and many more were penny stocks once. last I heard Apples stock was around $600.00.

david
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david
September 14, 2011 6:31 pm

I already own a large position but am holding long term on this one. I understand the tech bit that they are developing and it does have an important future in my humble opinion.

Harris S Levy
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Harris S Levy
September 14, 2011 6:38 pm

I suppose I am just lucky – when I read King's tease last week I bought a bit of the stockand paid about 23cents or so – II got under the wire before it went down to 16cents plus. Their story seems very good and so I would buy more at 1`5 to 26 cents and sit back and see if it evaporates or boild over. It was wonderful seeing Gumshow's "expose" of the tease so soon after I came to the same conclusions.

Harlind

Harris S Levy
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Harris S Levy
September 14, 2011 6:41 pm

Corrections from Harlind – I cannot see the text before it goes out so "I got under the wire" "I would buy more at 15 tp 16 cents or so" "see if it boins over"

Doug DeLaMatter
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September 14, 2011 7:47 pm

You might want to read Issac Asimov's "Sucker Bait" before getting into this too deeply. (Or just check out http://en.wikipedia.org/wiki/Sucker_Bait for the thumbnail sketch.)

Brian
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Brian
September 14, 2011 8:31 pm

IB is a decent speculation, their key assets are the patents they hold, which Gummy did not get into/ Holding it for a few years could bring vast rewards. What is the downside??, it is liquid and well supported at its current teensy price.

prophecyman
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prophecyman
September 15, 2011 1:14 am
Wow a stock I’ve been tracking for awhile is now being put forth in newsletters! Couple things that worry me are dilution which you can all obviously see. Over 250,000,000 shares! Dang! Also they have some bad debt with very high interest rates in my opinion. It’s definately an issue that needs to be resolved. Saying that I think the company has potential and a nice little niche. I mean who doesn’t want to make nuclear fuel safer? It’s now a huge issue after Fukushima. Their niche could become very lucrative. Sure the U.S. has stopped the building of nuclear… Read more »
prophecyman
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prophecyman
September 15, 2011 1:15 am

Forgot to add, not to mention other aspects of their business.

Alain
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Alain
September 15, 2011 7:48 am

To follow up on prophecyman post the Company just filed a preliminary prospectus on Sep. 12, 2011 to issue $13,000,000 worth of shares. So dilution as is definitely a concern here as it is in most Micro Caps.

Alain
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Alain
September 15, 2011 7:57 am

Also meant to add the company violated the covenants on two of their line of credit . The banks are asking to be reimburse and since there is not enough cash on hand and the company is burning cash they probably need about 5 to 6 million to reimburse the loans .

findin
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findin
September 15, 2011 3:00 pm

Another teaser I scanned about a month ago was about beryllium being developed as a component of nuclear fuel. It can withstand incredibly high temperatures, and could remove the risk of meltdowns in nuclear reactors. Does anyone know the name of this one?

Alain
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Alain
September 15, 2011 6:03 pm

It's the same company as this teaser IBC Advanced Alloys

findin
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findin
September 15, 2011 11:11 pm

Thanks. I suspected that might be the case. Any informatiin as to the feasibility of the beryllium nuclear fuel technology, and whether IBC Advanced Alloy and/or others are making any progress in that app.

findin

prophecyman
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prophecyman
September 16, 2011 8:50 am

Great catch Alain! The violations of their lines of credit is another issue. I believe it a reason the interest on one line is like 10%. Sorry if I’m off on that but going by memory. I also remember reading that interest rate can go even higher if anymore violations occur. If this keeps up it could get very ugly. They don’t want to get like our government and keep borrowing/printing money (issuing more shares) just to keep up with interest payments. I think there’s potential but I’ll stay on the sidelines until this issue is addressed.

Alain
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Alain
September 19, 2011 9:37 am

Thanks. Yes that is indeed why the rates have escalated.
I think you could take the issuance of shares in this case as fairly positive if the share dilution results in the lowering of interest cost and possible lowering the loss per share. Haven't ran the numbers but I don't see it necessarily as a negative.

kipper
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kipper
September 17, 2011 9:23 pm

fourth element old news,why not look at the fourth strategic metal manganese.Not mined anywhere in north america,Only deposit owned by Buchans minerals,TSX.v They are in the process of defining size,it is already in the millions of tons.

Alain
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Alain
September 19, 2011 9:50 am

Care to elaborate on what's attractive about manganese?

T1 California
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September 27, 2011 7:53 pm

Manganese was touted as “Supernova Gold” in another newsletter’s teaser from several months ago.

Myron Martin
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September 19, 2011 9:17 pm
Different strokes for different folks, surprised at the negativity given that high risk plays also offer the greatest rewards. It just so happens that I attended the Cambridge House Miners Show in Toronto last week and spent some time at the IBC booth because I have been a shareholder for about 18 months and wanted to know more about the company. First of all they have an EXCLUSIVE license for the technology from Purdue University and have contracts with both the U.S. Army and Airforce for numerous space age applications including parts made for the Hubble telescope. They also have… Read more »
Hans Kurr
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Hans Kurr
September 23, 2011 8:42 am
My biggest worry, Myron, despite the Army, Air Force and corporate orders, is that IBC is be burning cash too fast. They'll have to replace the loans just canceled, with SOMEthing. Given already staggering, still soaring U.S. debts, how do you see IBC surviving the Federal cutbacks that seem inevitable, whether voluntary or dictated by US$ collapse??? After all, the ongoing Euro-to-Dollar flight can't last: The market'll get back to realizing that the buck is safe haven no more, Uncle Sam's credit rating'll drop a lot more, the interest on that huge debt'll balloon…and even hi-priority projects'll get scaled back… Read more »
Povich
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Povich
September 22, 2011 12:21 am

Gumshoe still hits it home for clearing muddy waters!!! Thanks gentlemen for the info. as well as Byron for the clouded tips…

C Pat
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C Pat
September 27, 2011 7:18 am
Interesting stock, and patents may help. As far as making a killing, do not count on it. When someone bigger wants its tech, they will buy it out. Sure, you make something but big guys won’t allow coattails, and if IBC is in financial trouble [not profitable yet and high cost debt] they will seek it cheap. The hang time seems too long. One more aspect. B King is very good but may have missed one issue here. I had personal experience with a mining co years ago that sold $3B worth of beryllium in place for $500,000. It was… Read more »
triumf99
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September 27, 2011 5:02 pm

When I worked at a UHF TV transmitter site years ago I remember our Tx tubes had Beryilium dust inside them because of its heat transfer characteristics. I also remember what the hazard sheet said ,if you drop the tube and it breaks open, evacuate the area immediately and call a hazmat team!! One part per million can cause cancer!! It may help in cooling Uranium rods but if they ever do melt you will have a much more dangerous result.

robert
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robert
October 15, 2011 4:59 pm
Yes, I too have heard the hype types. BUT something is different , not just a feeling or problems I have had with past hyped companies. This one Hit a Cord with me, and not me alone GE is involved Toshiba, and Hitachi ALL Large well regarded companies. New they have seen HYED products before and know the real thing when it appears. Im sure Purdue university dept. of nuclear power knows a thing or two that also. Of course they have knowledge intelligence and could be swayed by possibilities as scientist are an idea intensive lot. The tests they… Read more »
Maxmas
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Maxmas
October 28, 2011 9:46 pm

I invested in this company nowing the risk and dangers of all of it. I spent a little and iam going to hold out and see, poeple say you have to spend money to make money and thats the american way bad thing happen and good things happen at the prices it is it a buy. Buy a thousand and seat on it or what ever you feel good about wining or loseing.

Earlyn
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March 21, 2012 2:03 pm

Hello,
Can any one give me an update on IBC Advanced Alloy. There is some new promotional materials being put out on this company, which says it could be a big winner.
I would appreciate any comment on status.

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