What is “The ‘British Columbia Gold Bank’ Now Open to American Investors?”

Sleuthing out Ian Wyatt's "Why I'm Selling Gold" teaser for a "BC Gold Bank"

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“One unique type of gold investment (that most Americans have never heard of) based in British Columbia has outperformed every asset class in existence – rising twice as fast as gold.

“The average investor in this gold secret made over 80% a year for 20 straight years – even after gold crashed last year.

“But some investors had the chance to make 3,000%+ gains…

“I call this investment the ‘British Columbia Gold Bank’ because it’s a super-safe way to invest in gold.”

That’s the intro from Ian Wyatt for the latest teaser pitch seeking subscribers to his $100K Portfolio newsletter, one of the many newsletters that cropped up over the past few years which runs a “real money” portfolio of the editor or publisher’s actual cash in the market.

Wyatt has been sparking interest among readers with emails that have subject lines hinting at why he’s selling gold — and he says he wants to sell gold and buy this particular “British Columbia Gold Bank.” So that’s getting attention because gold has fallen so hard and so fast, and investors are wondering just what to do with this asset that had seemed — for more than a decade now — like it could only go up.

And he implies a high level of safety for this investment, which also makes Gumshoe readers see green — here’s how he puts it:

“CNBC recently called this investment ‘a banker for gold miners.’

“As I’ll explain, gold banks have all of the upside of gold – with none of the downside – and the potential for much faster gains.”

None of the downside? That’s a big claim. So what’s he talking about?

Well, it’s a Canadian investment — he tells us all about how Vancouver is the “Wall Street of Commodities”, which is more or less true … that British Columbian City is home of what used to be the Vancouver Stock Exchange and is now the Venture Exchange (though I think it’s actually headquartered in Calgary now, the Venture is the combination of the Alberta and Vancouver exchanges), but it’s certainly a hotbed of junior mining and energy financing in Canada, which itself is the land where most mining startups get their sea legs. Vancouver is the silicon valley for venture investments, IPOs, and backdoor deals in the natural resources industries.

Here’s more from the ad:

“Thousands of small exploration companies vie for limited access to capital – many of them go bust.

“These small companies are the lottery tickets of the investment world.

“And they all need funding.

“That’s where the British Columbia Gold banks come in.

“They provide funding to the BEST possible precious metal startups – the explorers and developers with a track record of success, the best property, the best reserves, etc.

“In exchange, these ‘Gold Banks’ receive a portion of the future production and proceeds of any gold mined during the entire lifespan of the company.

“And the best resource analysts in the world all work in Vancouver – for one little-known gold bank…”

And then Wyatt lets the cat out of the bag a wee bit — telling us what probably most Gumshoe readers already know, that these “BC Gold Banks” are really just precious metals streaming and royalty companies. He even gives the examples of a couple companies that most investors are familiar with, the silver streamer Silver Wheaton (SLW) and the big gold royalty company Royal Gold (RGLD) … but he has another fish in mind:

“You can’t buy past performance.

“Royal Gold just isn’t going to grow another 2000-fold anytime soon. That would make it a $3 trillion market cap company. It would be bigger than the top 5 biggest companies in the Dow put together. It’s just not going to happen.

“Silver Wheaton isn’t likely to grow another 20 fold in the next three years either. That would make it a $140 billion company – bigger than BP (NYSE: BP).

“So if you want to achieve a similar result in your portfolio, you have to find the next Royal Gold and the next Silver Wheaton.

“Such a company already exists – and if you buy it today, you give yourself a great chance at repeating the performance of its forebears.

“This company is only about 4 years old and it is already off to a better start than Royal Gold in its first 4 years.

“That’s because this other ‘gold bank’ already has 10 gold streams producing with more coming online early in 2014 yet it has a total market cap under $600 million.

“And amazingly – they’ve put together deals with their 10 gold streaming clients to ensure they get access to any gold they mine for an average of $400 an ounce…”

OK, so that clears it up pretty well — we don’t even have to take the tarps off of the ol’ Thinkolator to tell you that Ian Wyatt is buying and teasing Sandstorm Gold (SAND in NY, SSL in Toronto)

Which I own as well, and have written about many times here — it’s been teased by other newsletters, and I’ve bought and sold the stock and the warrants a few times since the company was founded, but it is still a substantial position for me and my favorite gold equity investment.

But it sure ain’t a stock that gives you upside with “none of the downside” — those of us who have held the stock for a few years can certainly attest to the upside, but we’ve also felt the downside when gold prices fall.

All of the royalty stocks and streaming stocks, large and small, have fallen very, very hard with the collapse in gold prices — they provide some leverage to the price of gold as it rises, and also the downside of leverage as they fall harder than the gold price when gold declines. I’ve been a bit surprised, actually, to see that the royalty companies have not done much better than the average large mining stocks during this latest collapse in the price of gold — they’re better companies, with less downside than the miners in a normal operating environment, but they either got too expensive when people ran to them (they rose to trade at a marked premium to the big miners in terms of cash flow or earnings) or they got sold off too aggressively because everyone fled any investment with “gold” in its name.

Sandstorm does indeed get to buy gold for an average of $400 an ounce (roughly — it’s probably a bit higher than that now), but that doesn’t mean they are necessarily going to be profitable if gold falls to $800 or $700 per ounce. That’s because they’re a passive partner in the mines — and they don’t get to decide whether or not the miners produce, or how much they produce in any given year.

If you’re not familiar with this passive model, there are basically two kinds of these “gold bank” investments — royalties and streamers.

Royalties are generally a small net participation in the mine, either the full output or the output of a particular mineral (ie, a few percent of the NSR, or net smelter return, of gold from the mine). Royalties are sometimes sold by miners as a way to finance early development or exploration, and sometimes are earned by landowners or early prospectors.

Streaming deals are generally for a larger share of the production but they also require an ongoing payment — in the case of Sandstorm Gold or their progenitor, Silver Wheaton, they pay up front to help fund the mine construction or late stage exploration and receive the right to purchase a large portion of the mine’s output of the metal in question, often 10-25%, at a set price well below the market price. In practice, these are larger deals with bigger up-front payments, and they are usually done only when the mine is pretty close to production or expansion — needing just a big chunk of change for construction or final permitting or whatever the case might be.

Most companies in this mine finance space do at least a bit of each kind of deal — Sandstorm is primarily focused on streaming deals but they do have a few royalties, including some that they made as small deals that included a “right of first refusal” on any future streaming deals. Royal Gold is primarily a royalty company, but does have a few “streaming” deals as well. No one “owns” the idea or the concept, the reason there aren’t hundreds of these companies is that the market is fairly small, but also because you need a capital base from which to make those initial deals and build that portfolio of royalties or streaming deals, and it’s tough to grow until those deals start to generate cash flow that you can then commit to buying new deals and financing new mines.

The CEO of Sandstorm Gold, Nolan Watson, timed his formation of the company pretty well in what turned out to be the early days of gold’s run from $700-$1,900, and, perhaps more importantly, he made good deals that were close to generating cash — including one early deal that has become a much larger mine than anticipated and which generates the largest slice of their cash today (that’s Luna’s Aurizona mine in Brazil). Watson came from Silver Wheaton, where he helped to perfect the model of the public streaming company as a very young CFO, so he doubtless had good connections and good experience in finding and evaluating deals, but he also got a bit of luck in those early years. The company grew quite nicely but gradually early on, signing larger and larger deals and eventually growing the company large enough to make a NY listing feasible (it formerly traded only at SSL on the venture exchange, then graduated to the Toronto exchange before getting the SAND listing in New York).

The basic argument for the streaming and royalty companies is that unlike gold mining, they’re not terrible and unpredictable businesses — miners are often awful at managing costs, meeting deadlines, and handling the financial side of things, and they’re also subject to several things outside their control that dramatically impact their results, like natural forces (flooding of mines, etc), energy costs (mines suck up lots of electricity and diesel fuel), and labor costs, all of which can change dramatically in the many years between when the mine is initially drawn up and the time when it hits commercial production.

But streamers and royalty owners don’t really care about production costs, they care about production levels — they get their share of the output at a fixed price, so whether the mine’s cash costs of production are $400 an ounce or $1,000 an ounce doesn’t matter to them. It matters intensely to the miners themselves, of course, since that’s their profit margin, but, at least in theory, the passive financiers don’t have to care whether the mine is profitable — they get their ounces of gold, in Sandstorm’s case, for anywhere between $350-500 an ounce, depending on which deal it is, so they profit even if gold falls dramatically lower.

The downside, beyond the fact that they obviously have lower profits if they buy at $350 and sell at $1,200 than if they can sell at $1,800, is the same as the upside: They are passive. They have no real say in the operation of the mine. And if the miner is losing money for an extended period of time they may either slow production, slow expansion, or shut down the mine entirely until the economics (ie, the gold price or the input costs) improve. If the mine shuts down then the streamer or royalty owner may have some recourse if there’s a clause in the contract that they have to produce a certain amount by a certain date, but that’s not always the case and any such clauses tend only to cut losses, not guarantee profits.

It’s very hard to rely on analyst estimates for these companies, because those estimates obviously depend on the analyst’s vision for gold prices in the next year or two, but currently SAND carries a trailing PE ratio of over 50 and a forward PE of about 15, with analysts expecting the company to earn 23 cents per share this year and 40 cents next year.

Analysts haven’t been getting the guesses very close to correct on this one, and we can be sure that if gold stays in the $1,200 neighborhood for the next year they’re definitely not going to earn 40 cents per share — but if we assume that all of their partners will keep up their production to match estimates over the next year they will see a steady increase in ounces of gold delivered as a few new mines begin to boost production. They also have some potential catalysts — their next Brazilian mine, Serra Pelada, begins production this Summer and finally releases a reserve statement to give some idea of what that large mine might produce over time, and the Deflector project in Australia is in a spot of financial bother (they have to raise their last cash just when it’s hard to finance mines) but should be able to start production soon as a low-cost producer, and both of those are expected to be meaningful producers for Sandstorm within two or three years.

Sandstorm’s estimates are that they will go from an estimated 35-40,000 ounces of gold this year to 70,000 ounces in 2016, and they are becoming more diversified as more new mines grow and come online, so there is a strong growth potential and they do pay a low average price of probably $450 for those ounces (the later, larger deals they signed are generally for $500 an ounce, bringing the average up a bit) — but with average all-in costs of gold production for most big miners in the neighborhood of $1,200-1,300 an ounce this is a pretty critical price point. If mines shut down or pause development, they’ll be in trouble, but Sandstorm’s focus has generally been to make deals with lower-cost producers so they should be OK as long as prices don’t fall below the $1,000-1,200 range.

“OK” doesn’t mean hugely profitable, though, it just means they should be profitable or at least breaking even and generating some positive cash flow — their profits would be dramatically higher if you can use a $1,800 gold price estimate. On the flip side, they do have close to $100 million in cash and another $100 million in a line of credit, so they have some flexibility to sign good deals with desperate miners right now — which, if you assume that gold will eventually recover, could lead to even better growth. Money is very tight in the mining industry these days, so they are, at least, in a strong bargaining position for new deals they make.

So I can’t say that Wyatt’s right about this pick having “none of the downside” of gold, because we’ve clearly seen that if gold falls the royalty and streaming companies can fall even further (gold fell about 25% over six months, SAND fell 50% as a result) — but I still prefer SAND to their larger competitors RGLD and Franco-Nevada (FNV), and I think they should be in reasonable financial shape as long as gold remains firmly above $1,000 and their partners keep mining. And that leverage that brought the price down works both ways, so if you think gold recovers or resumes the push upward to $2,000 an ounce, Sandstorm will be extremely profitable. Hopefully after having made some lucrative deals at these relatively low gold prices.

What do you think? Will the continued absence of inflation mean gold stays low or falls further, or will the continued efforts by every central bank to devalue their currencies eventually work and drive more investors or savers to gold as a store of value or “safe haven” refuge? I keep some of my savings and portfolio in gold because it has held its value over the long term, but “long term” when it comes to the enduring value of and human interest in gold has often meant decades, not weeks or months or even, as we’ve seen recently, years. I’ve written to the Irregulars recently that the fall in gold has led me to think that I should be rebalancing a bit and adding some to my holdings in the metal or in Sandstorm or one of the other royalty companies, but I haven’t had the gumption to actually do so.

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63 Comments on "What is “The ‘British Columbia Gold Bank’ Now Open to American Investors?”"

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Doug H.
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Doug H.
July 9, 2013 1:38 pm
I looked at gold and silver after the 2007/8 fiasco affected my IRA. I wish I had known about inverse ETFS then and I’d be ready to retire! But I do now and I have been making some money on GLL and ZSL but with my cues from an experienced pro. He is assocaited with Weiss and resides in Thailand, so you may be aware of him. I also read every article I could find from Ted Butler and have coem to believe that gold and silver in particular are maniplated by several entities that include JP Morgan bank and… Read more »
pcolajoe
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0
pcolajoe
July 9, 2013 1:47 pm

Very good write up, and I agree completely. I too have owned SAND for some time, and I am staking a lot on Nolan’s expertise. Also I see a steady increase in earnings ahead. This is a long time hold for me, and I hope it is not too long as I am 77 now. Still young, lol.

simong156
Irregular
24
simong156
July 9, 2013 1:47 pm

I have no exposure to gold and was considering the three stocks above. But am I trying to catch a falling knife?

Deborah Flynn
Guest
0
July 9, 2013 1:52 pm
To me its one of those stocks at the price it is to grab a few hundred shares on the HOPES gold goes up a bit. I think its going to be in the doldrums for a bit because of the negative publicity surrounding the drop. NOT the demand just the drop in price. I buy physical gold dollar cost average for my grandkids . When they get out of High School they get the coins for college if not I hold them until they get married[no wasted money on cards and partying lol] My opinion is if Trvis owns… Read more »
Chad Graham
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0
July 9, 2013 2:19 pm
we agree with your sentiments. however, all this QE and watering down currencies values as far as FAIT is concerned is problematic. we are of the opinion that gold has a split personality, that is is it a asset or commodity. Once gold decides on her personality then things will change. please consider, inflation since end of WWII up until today. It is apparent that inflation has not really had an effect on the AUXUS$ price, since if it did then gold should be sitting at levels somewhere between and in between US$3500 – 4500/oz…the manifestation of this in its… Read more »
tomt
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0
tomt
July 9, 2013 4:32 pm
Nice presentation of SAND Travis, and it will likely experience big gains over time. The best of these opportunities in juniors and well positioned mid tier producers / streamers will come through this rough patch. Private funding is happening, and much like SAND, very talented speculators like Sprott’s Rick Rule know who the likely winners are and fund them. As for the price, if you hesitate too much, you’ll miss it- buy some now, and be prepared to buy more at lower prices. If your already holding, keep holding, as most of the damage is done, and its arguably one… Read more »
mcmannis
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0
mcmannis
July 9, 2013 5:02 pm

What is the symbol for SAND warrants, plus expiration date and expiration price?

pcolajoe
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pcolajoe
July 9, 2013 8:01 pm

SDXXF is the id for the warrant expiring in 2015. It takes 5 shares of the warrant plus cash, (5 dollars to redeem one share of SAND).

charlier1955
Irregular
33
July 9, 2013 9:02 pm

Travis;
Could you comment: is it better to buy the Toronto Exchange – ssl.to ; or the NYSE Sand?
Also isn’t it always better to buy a small stock off its exchange, rather than the pink sheets?
Links for further reading would be appreciated.

Thanks
Charlie

charlier1955
Irregular
33
July 9, 2013 10:48 pm

http://sandstormgold.com/investors/warrant_info/

Another rookie question: The April 14 warrant requires you to buy 5 warrants to exercise one share of stock at $3 USD? correct?

http://finance.yahoo.com/echarts?s=ssl-wt.to shows the warrant at .61 (7/9); .61 x 5= 3.05 is the cost to purchase the warrants for 1 share.
Exercise price of $3.00 plus $3.05 equals $6.05
http://finance.yahoo.com/echarts?s=sand current price is $5.94
$6.05 minus $5.94 equals 11 cents for almost 10 months of time value.
That is extremely low. Am I getting it right? I don’t follow this every day, but is it possible for there to be a negative time value?

Chad Graham
Guest
0
July 10, 2013 9:27 am
Gold is not manipulated by any means. this thing about stop hunters and blah..blah….simply when leverage is involved expect wild swings. Travis, in the end we agree with your analysis. long term trend lines for AUXUS$ still untouched…so maybe you are wrong on this day…however in the end it will still manifest. as for folks who are not doing their own homework….they are the first to be wiped out. you can not rely on Travis’s crystal gold ball. if he had that ball…his name would be with the legends. anyhow, not a bad hit run Travis 1 strike 9 hits.… Read more »
Myron Martin
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0
July 10, 2013 12:15 pm
Very interesting reactions from readers. I actually just finished reading Wyatt’s promo and then “googled” for a $600. million Mkt. Cap Gold Streaming Company to confirm my guess that this had to be Sandstorm, which I still own as “free trading shares” after getting my initial investment off the table. Of course this column by Travis was on of the first to show confirming my guess, and for the most part I agree with him, the main difference being I was in earlier at low prices. To make money in the juniors mkt. you need to have a disciplined strategy… Read more »
Alan Harris
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Alan Harris
July 11, 2013 2:09 pm

Im always intrigued when someone talks about ‘due diligence’ as if its an exact science coz there are so many versions. Asking as a novice (which I am) Id love to get your explanation. If its too long for this sheet, Id appreciate an email via gumshoe office email….they have passed stuff on before. Regards Alan

charlier1955
Irregular
33
July 10, 2013 4:07 pm

Please don’t say this market cannot be manipulated. This market can be manipulated, and may be. We have no way of knowing with the information we have now.
Where is the bottom? I don’t know. I am now in 100% cash, and probably will not invest until a new trend is established.
In the mean time, study the Hunt Brothers and their attempt to corner the silver market in the 70s:

http://en.wikipedia.org/wiki/Nelson_Bunker_Hunt

Here is a book on the subject I would love to read, but don’t have the money for:
http://www.amazon.com/Manipulation-Trial-Economic-Analysis-Silver/dp/0521440289/ref=sr_1_3?s=books&ie=UTF8&qid=1373486194&sr=1-3&keywords=silver+hunt+brothers

Chad Graham
Guest
0
July 16, 2013 3:33 pm
and in the end what happened to the Hunt brothers?? how about the others who have tried…Enron….Bears Sterns and how many banks?? people should rather vote for responsible governance instead of the thugs stealing from our life’s work….governments can do market manipulation..but that will also catch up and the consequence is dire…we have 2 many super powers with money that they will flush down the toilet protect their interest….since they have no clue of an honest day of work. Economy of scales are against them. ask yourself a question. if all World Banks increased their current gold holding by 0.5%,… Read more »
peejay
Member
2
peejay
July 10, 2013 5:50 pm
I am no expert on gold shares, but I have held the physical stuff for many years, and the recent drop in price has not put me off – indeed I bought more at US$ $1200 a couple of weeks ago. Gold is a must for any portfolio. I have heard figures from 5% to 15% bandied around as a percentage of worth which should be invested invested in it, and I would think either end of the range reasonable – no point in having all your eggs in one basket, but this basket is a must. I would not… Read more »
CoolSoupy
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0
CoolSoupy
July 11, 2013 8:48 am

The big whoosh (sucking sound) is gold metal leaving for Asia. Are they stupid?
I THINK NOT !!!!!!!!!!

Alan Harris
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0
Alan Harris
July 11, 2013 1:46 pm
Theres nothing like gold to polarize a crowd. Still no one has mentioned the effects of India putting a 8% tax on physical and persuading dealers to stop selling bars and coin. Is that why its fallen so bad? I guess stashing your black cash in gold makes it far less visible for tax than a bank account that reports your savings back to the gov. Also the comparison between gold and AUXUS$….. if it hasn’t risen to $3.5k, doesnt this reflect how much more gold has been dug up over the period ie its not as rare as it… Read more »
peejay
Member
2
peejay
July 11, 2013 3:13 pm
India put a tax on gold to raise money, not to persuade dealers to stop selling it, even if that was the party line. It is a pre-requisite of marriage contracts in India that gold is delivered with the bride. This is a centuries old practise, and I do not believe that 4% extra tax would stop it. I do not know how much gold is still in the ground, nor do I know the whereabouts of the gold already turned into bars, coins, jewellery, and other items. I would not put much store in comparisons. Like silver to gold,… Read more »
Alan Harris
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0
Alan Harris
July 11, 2013 4:59 pm
Ignoring your Gnat obsession (Im sure you are far too much of a gent to have directed the remark at me) I was quoting from Reuters today: The All India Gems and Jewellery Trade Federation, which has more than 40,000 members, added that over 65 percent of jewellers had agreed to the ban on sales of (gold) bars and coins. I’ll accept that the bride comes with gold, but that tends to be jewelry, (or teeth if they’re as ugly as a mosquito) ”One never knows how much that cash will be worth further down the road.” That was my… Read more »
Alan Harris
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0
Alan Harris
July 11, 2013 5:47 pm
Oh sorry I forgot a couple of things: Reuters today: India’s government has hiked import duty to 8 percent. While I have no doubt that every taxman wants to get his grubby hands on 8% of her teeth, there is probably a 2nd objective. Gold is a STORE of value. Squirreling it away in some bank vault or just decorating Doris Patel’s scrawny neck, starves their economy of gazillions of working capital that could be being used to develop their industrial base, feed the poor, improve the environment, build infrastructure and secure a prosperous and lasting future for the entire… Read more »
peejay
Member
2
peejay
July 12, 2013 12:38 pm
Hello Alan, I wrote a long reply, and then shut the computer down without sending it. So this is guaranteed to be shorter. An advantage, you might say! Anyway, the gnat remark was not directed at you, nor anyone in particular. It was just to say that in my view gold should be regarded as an investment, not a high frequency trade. Gold teeth is good – but those and jewellery will not be likely to come under the gold ban which I see as coming to a cinema near you soon. Western governments should not be trusted as far… Read more »
ed
Guest
0
ed
July 14, 2013 12:38 pm

“…then there is how long they can get the poor sods going down into them to work for a pittance.”
Where are talking about – maybe Africa. Gold miners make very good money in North American, Australia and other countries.

peejay
Member
2
peejay
July 14, 2013 2:43 pm

Your right,, Ed, some miners do well, although 50% of the worlds’ gold reserves are found in Africa, and between 15% and 30% of production is usually there. That would make a difference, wouldn’t it, if South Africans were paid the same? Even if one ignored Argentinian miners, Chileans, Uzbekistanis, Indonesians, miners in New Guinea, Peru, Egypt, Pakistan, China, Ghana, Burkina Faso, Mali, Russia, and the famous miners of Ecuador. So just where are we talking about that miners earn a wage commensurate with the risk apart from the USA and Australia?

Bruce K
Guest
0
Bruce K
December 20, 2013 5:16 pm
Wow: that sounds like the guy who said the majority of oil was in the middle east 30 years ago. Technology determines where every energy source and metal are “found”. 8 years ago we started to see the potential of new metal resource bodies, but only now are the new processes starting to work that will allow the extraction. Gold recoveries in the future will be as different from this discussion as x-rays and MRI’s are, or drilling and fracking. And the reserves in the “mines” accessible to these technologies may also be of comparable scale differences. Geological events determined… Read more »
tomt
Guest
0
tomt
July 11, 2013 10:55 pm
Yea, buy some gold. To answer your question at least with a point of view regarding hoarding in India, an its an interesting point, yes hoarding does constrain and economy and the multiplier affect called velocity, as the banks are hoarding their cash (and have huge debts too) here as well. The Fed pays them to keep it on deposit. So your correct, but do you realize India’s rupee has fallen for quite a while and continues down, so the people protect themselves. There is heightened anxiety everywhere and Argentina just topped Vietnam for highest premium over spot. Americans don’t… Read more »
baygreen
Member
32
July 12, 2013 5:23 am

When the tide turns there will be a storm to be on.

Chad Graham
Guest
0
July 12, 2013 5:55 am
consider: gold does not know race, religion or any other MAN made concept. rightly a few mentioned gold as a commodity. however, their are many peoples that view it as a asset. we are in that category of asset. simply put you can put a few gold coins which we manufacture in your back pocket and arrive in some foreign land and not understand a word they are say and yet you will still be able to trade and enrich your self. in Zimbabwe the currency has an expiry date valid for 12 months from print…if you do not spend… Read more »
charlier1955
Irregular
33
July 12, 2013 10:35 pm

Chad; Can you post any links on this China London thing?

Chad Graham
Guest
0
July 20, 2013 2:40 am
my aplogies for my late reply. actually i did reply. and typical of governments interfering in free enterprise (monopolies)…my signal was so weak i ran out of patience to wait. anyhow, their is no official comment about China-London gold standard, however their have been well documented calls from some power individuals who have made calls to bring the gold standard back. it is discussed based on maybe…within the walls of bankers and governments. Any how allow me to draw a picture for you and you can decide for your self, everything that has been written here is true, even when… Read more »
Alan Harris
Guest
0
Alan Harris
July 12, 2013 3:58 pm
As previously said: nothing polarizes the crowd like gold. While the subject fascinates me, I have no gold other than two old wedding rings……..the most expensive purchases I ever made! Strange how the ladies always leave the wedding band on the dresser…..but NEVER the diamond engagement ring. Hmmm….I digress. At the risk of outstaying our welcome on this Gummy board, Id like to play devils advocate a bit. Anyone who’s bored can skip to the next reply now with my apologies. I think its important (perhaps idealistic) to remember that governments are there to serve the whole of society…not the… Read more »
Alan Harris
Guest
0
Alan Harris
July 12, 2013 4:02 pm

Oh and the Chinese…..while all their money is tied up in $’s, you control them. If they form a different standard…….they’ll control you.
Its a lot cheaper to wage financial war than physical war.

peejay
Member
2
peejay
July 12, 2013 5:16 pm
Ah, a dreamer. Now I understand. Paraphrasing JFK: We’re the bosses, you’re the workers. No philanthropy there. No different to your unpatriotic patriot. One law for them, another for you. So let’s see. Governments live on taxes – that’s why they like to raise them. But wait – the members of the EU regime don’t pay taxes! Neither do those who work for the IMF! And when you can cream off all the expenses you like, without proof of payment, unlike the population you govern, then who cares? Government employees salaries are taxes, just reduced a bit to make it… Read more »
Alan Harris
Guest
0
Alan Harris
July 13, 2013 11:40 am
Hello Paul Me a dreamer??? Far from it. You appear to be saying you’d only trust a politician if they are 100% altruistic, smarter than new paint AND guaranteed whiter than white. If you’re ever expecting to meet this human, I think it’s you that’s the dreamer. Me?….I’m a realist. I know Im far too busy to run my own country and its economy etc, and given that I can offer just one vote, I know they must appeal to the majority to get the gig ie they must serve the WHOLE of society, not the minority. But we are… Read more »
peejay
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peejay
July 13, 2013 2:42 pm
There’s nothing wrong with being a dreamer! It was not a negative comment, rather a positive one. No, I don’t trust any politician. That was a full stop. I do admire your level of trust though. I hope they don’t let you down. They will, but I still hope they don’t. Look at the election results almost anywhere in the Western World for the past decade – 51% for them, 49% for the other. It has to tell you something. It tells me that there is no difference which one you vote in. They are both (all) the same –… Read more »
Alan Harris
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Alan Harris
July 13, 2013 5:02 pm

No taxman! Where do you live, on a private island????

Alan Harris
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Alan Harris
July 13, 2013 7:04 pm
We could bat this around forever. Best investments change like the wind as you’ve demonstrated by citing Swiss francs over 20yrs. Only 6 months ago I read a gazillion articles predicting gold was going to $2500 (or was it $25,000)…..it’s now half that. Ill bet those who listened are thrilled with that advice…..not ! Of course, if the wind changes it may go to 25k. I’m glad for you that you have all those paperweights stashed away. I wasn’t actually talking about property. But…. Houses in Ulster, Newcastle or anywhere else in UK havent gone down 40% in the last… Read more »
peejay
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peejay
July 14, 2013 10:55 am
Hello Alan, Do I live on a private island? No. There are more choices than that in the world. However, I feel you are so well rooted in the UK that you would click your heels together like Dorothy, and say “There’s no place like home”. The British are not a bad lot (nowadays), especially the Polish ones! Houseboat. Had it right. Dreamer! Well done, Narrow boats, and especially Dutch barges are very beautiful – and moveable! However, a bit small to grow tobacco on. Are you allowed to grow 4 cannabis plants in London, before the forces that be… Read more »
Alan Harris
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Alan Harris
July 14, 2013 4:12 pm

English actually….The British are foreigners…… especially the Polish ones.

Alan Harris
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Alan Harris
July 18, 2013 4:52 am

Hi again, Paul Jessup and anyone else interested in gold,
I wasnt expecting to write again, but this hit my inbox. Its from an Economist I read. Its call Things that make you go Hmmm…. Its v long but v v interesting and well worth it. http://www.mauldineconomics.com/ttmygh/what-if
I think it means they have sold twice as much gold as exists…..perhaps you can translate it into English for me.
Enjoy
Alan

Chad Graham
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July 18, 2013 7:16 pm
thank you for sharing this info. it is in line with our analysis….one part we never included though that makes the situation extremely dire is the divergence of available gold in storage and “the cloud” version which does not really exists except on the back of gold owners lending gold. in a nut shell leverage of 100/1 VS gold in storage has a major shortfall. furthermore, when large owners demand their gold to be delivered then gold in storage becomes less…in a way it means the leverage increases since the gold in circulation is decreasing. meaning when the “herd demands… Read more »
Chad Graham
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July 18, 2013 7:22 pm

that is why people are taking their bullion out of banks and other and its disappearing “into thin air” the clever money is avoiding governments forcing you to exchange your gold for FAIT currency. as governments according to the bill of exchange act are in contravention of the act, check your cash notes it says…”i promise to pay the bearer”. Governments are bankrupt and they are coming steal your families wealth…

ed shannon
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ed shannon
July 18, 2013 8:21 pm

I believe (from a faulty old memory) its Sprott that actually has gold, silver and platinum in a vault and you may be able to get your money in those precious metals.

Chad Graham
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July 19, 2013 2:13 am
SPROTT is Canadian based company. your gold is not safe their. their are 2 ways to avoid your gold from been confiscated, you need to move it to a place like Switzerland and their are other destinations which we offer our private customers. the other way is to buy gold coin collectibles. for example we have dedicated a gold coins in memory of Nelson Mandela, the Rhino Extinction fund, memorial day of WWII and so fourth. these are collectibles and government cannot take them. our activities are private and not disclosed. and anyone with US$3000 dollars or more can get… Read more »
peejay
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peejay
July 19, 2013 3:45 pm
Hello my All-England friend! Read all of the article, watched the video, and heard what Kaye and Cashin said. Very interesting, thank you for posting it. It was more precise that I could be, but exactly my sentiment (or a translation for you regarding the sale of non-existent gold) – we are being had – or at least they are trying it on. Smoke and mirrors. As I wrote originally, only buy physical gold. Margin and leverage trading will soon be a loosers game. Gold is not expensive with regards to its cost of mining. I would have bought even… Read more »
Alan Harris
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Alan Harris
July 19, 2013 4:44 pm

Hello my (?) friend.
Thanks for your warm greeting….I wish I could respond in kind but you play your cards too close to your chest for me to know.

Now I get it. They depress the price of physical by buying ETF puts. Meanwhile they scoop up physical on the relatively cheap till cupboard is full again. Then they will sell the puts rapido causing physical to rise furiously = net gain. Finally, they rent the physical gold back to the etf to cover its shortfall….= profit.
Neat.
PS: I assume loosers/loosing = losers/losing. Still an A* for investing aint bad 🙂

peejay
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peejay
July 19, 2013 5:15 pm

You are not slow!
p.s. Must git an spill chukker.

Alan Harris
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Alan Harris
July 19, 2013 4:50 am

I guess the ‘cloud’ is now the new fiat reality.

Politicians are infinitely devious.

Alan Harris
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Alan Harris
July 19, 2013 4:52 am

Ps I hope your gold is safer in a Swiss bank than your banking details have proved to be.

Chad Graham
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July 19, 2013 5:23 am

lol…yeah..spoke like true and well seasoned investor….you know how it goes…best to learn from our mistakes otherwise we are destined to repeat them

Alan Harris
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Alan Harris
July 20, 2013 12:44 pm
Not intending to disparage what you say, but as Gumshoe and a million other threads demonstrate, there will always be an infinite number of speculative opinions especially about money (whatever that is). Here’s mine for what its worth….probably < a nickel. As I see it, initially, China never really expected their bonanza to take off like it has or last this long. As they were not sure of the political repercussions of turning towards capitalism, they squirreled their dosh away in the only place they could… the reserve $. Later, they decided the only way they could keep the boom… Read more »
Chad Graham
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July 22, 2013 2:42 am
agreed. China as we all know has a pollution problem. considering the unregulated industries and for the growth to be in the 10% pa ..its a bit like the wild wild west. reform is the talk of today and some cities has already become “green” and industry is been forced to become green. in fact the green movement in China is the fastest in the world considering the economy of scales. one area we disagree on is that our analysis points to the Asian market growing when the west will be shrinking. so the Shanghai composite we think is the… Read more »
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