“Best Gold Story in 14 Years?” McCoach

“Will your assets be forced into … the New Obama IRA?”

[cue spooky music, please!]

“If you think your 401(k) statement looks bad now, just wait… Your retirement funds could soon be devastated at the hands of a new government initiative to “save” your retirement.

“Still, you can avoid this coming disaster and protect your assets… all while cashing in on potential blockbuster returns of 50-to-1 or more.

“It’s what Greg McCoach calls “one of the most compelling gold finds of the last 14 years.” But you must act now – before the damage is done…”

That’s one of the intros to Greg McCoach’s latest ad for his Insider Alert newsletter, the “upgrade” version of his services that includes access to the microcap mining stocks that he actually buys. The newsletter will cost you about $2K a year … but perhaps he’s got a hot little teaser stock to share with us that we can sniff out for free?

Well, he does tease one — but I have to warn you, this is one of those rare times when I’m not at all certain what the answer is, though I’ll supply a “best guess.”

The “Obama IRA” spiel is a nice hyperactive rant — he goes on about

It’s not all that different from the last time I wrote about this Insider Alert newsletter — back then, McCoach seized on some FDIC reports to tell us that banks would be falling like dominos, and that the rush would be on for silver, pushing up shares of his favorite speculative silver miner.

Of course, it turned out that he was mostly right about the banks collapsing — and mildly wrong about silver, and super-wrong about the silver mining stock he was touting. At least, so far. The last time I wrote about this miner for one of his ads (the company was Canadian Zinc, by the way), silver was close to $17 and the stock was around 65 cents. Now silver, after a big run up recently, is right around $14 … and Canadian Zinc is at about 15 cents.

So just keep in mind that he may or may not be right about any of this — and as with all well-written teases that lead you down a path, the fact that he might be right about part of a scenario doesn’t mean that his predicted outcome is necessarily more likely (ie, the FDIC may be under huge stress as it’s called in to rescue big banks, but that doesn’t necessariiy mean silver goes back to $50 an ounce). That’s not a criticism that’s unique to Greg McCoach or to little mining stocks, of course, but this seemed like a good time to mention it anyway.

So what are we told here?

The big picture scenario is this:

“How a 76-Year-Old Executive Order is Suddenly Your Biggest Financial Threat

“I realize what I’m saying may be controversial…

“But what follows is a news story you’re very likely to see within the next eight months.”

[He then basically inserts a cribbed version of FDR’s executive order on the confiscation of privately held gold, replacing the word “gold” with “retirement assets” … I won’t copy the whole thing here]

“Does that “news story” sound like something from a far-fetched movie based in the future? Something so ridiculous there’s no way it could ever happen in the good ole U.S. of A. that you know and love?

“Here’s the thing:

“It already happened – back in 1933 when Franklin Roosevelt signed Executive Order 6102, effectively outlawing the ownership of gold by private citizens.

“In fact, much of the text from the “story” above was lifted directly from Roosevelt’s Executive Order. Just substitute “gold” for “retirement assets” and you’ll have the original text.

“And if you think taking a step as drastic as this couldn’t possibly happen in this day and age… Think again!

“Brazil’s government confiscated its citizens’ assets in 1990 – and then introduced legislation seeking the authority to do it again as recently as 2004… and Argentina took steps to confiscate private pensions last October.”

Well, it is an appealing scenario, especially for conspiracy buffs — I’m not sure if it’s at all probably or possible, or why McCoach thinks that owning shares of a Canadian gold miner would protect you from this scenario (I guess we’ll have to assume that you hold those shares outside your IRA). It seems a bit odd, though — from what I understand, FDR’s forced purchases of gold from US citizens was a way for him to devalue the gold-backed currency and inflate the country out of the depression, whereas the Fed and Treasury are perfectly capable of devaluing the currency without any such action right now (and arguably are already doing just that).

And yes, the Argentina bit is real — they privatized their pension system in 1994, and moved to “de-privatize” it last fall as part of their panicked effort to keep the economy afloat and cope with their massive debt. From what I understand, that was largely like privatizing Social Security and them de-privatizing it 14 years later, they didn’t have the confusing mishmosh of different defined contribution voluntary private retirement accounts that we have, these were really pensions. There’s a good blog post about this from the UK here. Not sure what has happened in Argentina more recently as I haven’t been following the story, but this is also not the first time pensions have been used by the government — I think they used pension money to guarantee their massive debt during their last debt-fueled crisis, not sure (and yes, “using pension money to guarantee their massive debt” does sound a little bit like Social Security’s current situation). I don’t know the Brazil story.

That probably opens up enough of a can of worms for folks to fight over for hours, so I’ll leave it there.

But what’s McCoach’s recommended course of action?

Here you go:

“And the prospect of seeing the Obama IRA plan come to pass has pushed me to uncover not just a way to save your retirement assets…

“You can also make back everything you’ve lost during the current economic crisis – and then some – with one simple investment.

“Here’s what I mean…

“Within the past few weeks, I’ve closely examined the potential of a Canadian-based gold and metals exploration company that presents an enormous opportunity.

“To tell you that I liked what I saw would be an understatement.

“That’s because I’ve discovered that this extraordinary company has the potential to see its share price explode from 30 cents all the way to $37 in short order.”

We’ll leave aside for a moment the still-very-much-open question (“Why would buying this stock protect your retirement assets, when your other investments are seized? Can the government seize other assets but not breach the force field around Canadian junior mining companies”), in order to figure out which company this is … if we can.

“This company has staggering short-term profit potential because it’s sitting on not one, but TWO potentially explosive discoveries in a region with an unmatched history of gold discovery.

“The Abitibi Greenstone Belt lies on the border of Quebec and Ontario border in Canada. And over the last 100 years it has produced more than 180 million ounces of gold.”

And here are the rest of the details in the teaser:

“… the location of this company’s projects is even better news. You see, they’re positioned right near existing mines, and as close as three kilometers away from one “major” exploration company. Because of the location, the likelihood of a large discovery is increased… and the infrastructure is already in place to take advantage.

“On top of the favorable location – and the massive potential for each of the two properties – there’s also an astounding geological story behind one of this company’s properties.

“The company drilled three geological holes in 2008 to determine if volcanic massive sulfide was present – and the results were positive. Since that time the company has invested a ton of money drilling additional test holes – and graphite was discovered.

“This is a huge positive indicator – along with the large magma chamber that was discovered – because it’s located next to an aging, producing mine… one that’s owned by a major and figures to be depleted in 2014.

“For all intents and purposes – any new volcanic discovery of size on this property would make it nearly impossible for the neighboring major NOT to buy this company out.”

So … I spent quite a bit of time looking over this one and examining the possible matches, and I must admit that this one has me pretty well stumped. There’s just not enough information in the teaser to be certain, at least not yet. But I can tell you that the closest feasible match is one that I and the folks who contribute on the forum can agree on: Explor Resources (EXS in Toronto, EXSFF on the pink sheets).

It drives me a little bit crazy that I can’t be definitive on this one — there are just too many companies that could possibly match those squishy clues, and this match is far from perfect, but perhaps it will be enough to get you started. One of Explor’s sites is indeed within a few kilometers of a major mine, though it’s not a gold mine — they’re about 2.5km away from the open pit of the old Kidd Creek mine that’s now an underground mine operated by Xstrata. That has been a huge copper and zinc mine for decades, and they’ve recently been exploring further underground but could potentially run out of ore to process in 2014, as teased.

A bit of a stretch, certainly. I have no idea whether or not Explor has found a “magma chamber” in its drilling, and while their very early drilling in 2008 on some of their properties has perhaps been promising, I’m no geologist and I have absolutely no idea whether they hit graphite — or even whether hitting graphite would be a good thing. And to add to the troublesome lack of a precise match here, Explor actually has far more than two properties — they have a dozen or so properties in the Abitiibi Greenstone belt in Ontario and Quebec, though they’ve really only gotten far in drilling two or three of them.

So … I hate to leave it hanging like this, but every once in a while there just isn’t enough data (or enough Thinkolator brainpower, I must admit) to suss one out for you. You’re more than welcome to hop over to the forum thread on this and see if you can pitch in or add your two cents. As I said, this is the best match I’ve seen yet for this teaser — but it’s far from a perfect match.

Oh, and on that “disconnect” between the fearmongering of the ad and the actual company teased? Whether this is Explor Resources or someone else, there is obviously nothing magical about any one company’s ability to protect you from the hypothetical government seizing of retirement assets. If you think that IRAs or 401ks would for some reason be seized by the government, and you believe that owning foreign gold-mining stocks would somehow protect you from that, then there are literally thousands of such companies in the world — and at least dozens exploring in the Abitibi Greenstone area of Canada, which has been responsible for much of Canada’s mineral wealth so far … so take your pick.

And I tend to get headaches if I read too many reports that use words like “assay” and “core” and “inferred,” but if it’s just little gold mining companies in general you’re looking for, you can spend your whole life searching for the next mother lode … some that we’ve looked at here in the past that might be interesting stories for you are Hill End Gold in Australia, Centamin Egypt, Altius Minerals in Canada, Keegan Resources in Ghana, and there are probably hundreds of gold miner discussions over at the forum right now if you’ve got some time on your hands. Enjoy!

Full disclosure: I currently own shares of Hill End Gold and Altius Minerals. I won’t trade in any stock mentioned above for at least three days.

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36 Comments on "“Best Gold Story in 14 Years?” McCoach"

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Cool Soupy
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Cool Soupy
May 14, 2009 11:59 am

As a side note!
I was raised during the WWII by very staid old grandparents that very seldom had heated discussions.
I remember vividly that my grandmother “nagged” in a not so gentle voice that granddad must obey the law and turn in his gold coins. So I didn’t get any!!!!

Darrell
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May 14, 2009 12:07 pm

I think our thread agrees with you, sir. We looked hard and the debate seems to fall that way.

Scott Rowe
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Scott Rowe
May 14, 2009 12:40 pm

Although the price doesn’t agree with this article, the most promising junior gold in the Ontario Quebec area seems to be Rubicon (TSE:RMX) This is being explored next door to the well known and established Goldcorp properties.

Dusty
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Dusty
May 14, 2009 1:33 pm
There are commercial uses for graphite in industry. There is a graphite mine in the middle of Texas that I am aware of. May or may not still be a working mine. Memory fades, but there are several gradings of graphite and each has some use in industry as an aid or ingredient in production. So a new source of graphite, depending on how it grades, has value. I seem to recall that most of the finer grades of graphite are being mined in Europe and maybe Russia and that the few sources of the coarser grades of graphite available… Read more »
spreadtrader
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spreadtrader
May 14, 2009 2:31 pm

Glad to see everyone has their favorite miner. Mine is GQC…….

http://www.goldquestcorp.com/s/Home.asp

Gee
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Gee
May 14, 2009 2:41 pm

There seems to be no shortage of small gold mining stocks – but does anyone know of an ETF for small mining/exploration companies to allow investing in basket of such stocks?

robert cleaver
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robert cleaver
May 14, 2009 4:27 pm

Re.”Best Gold Story in 14 years” by Greg McCoach.
Would Mr McCoach please contact me by phone at Toronto Canada 416 201-9223 or e-mail.
I have important information on a junior exploration company in the Abitibi Greenstone Belt.
Property is 1 mile from the 11 million ounce producer “Kerr Addison” mine. Canada’s biggest producer from 1 shaft.
Very high grade diamond drill intersections eg 33Gt over 28.5 feet at less than 300 feet deep.
Sincerely,
Robert Cleaver

Ian George
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Ian George
May 14, 2009 4:52 pm

I’m guessing the tip is for AMX:TSXV, CA (Amex Exploration, Inc) — right price (closed at 0.375 CAD today) and right region (Abitibi) and right size.

I haven’t checked everything else out, but I didn’t see anything that didn’t fit either

Loren
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May 14, 2009 6:05 pm
Travis Once again,,,,,great sluthing work! However, I have to remind you: your time and expertise are both very valuable, and I still wonder why the newsletters writers spend so much time on Canadian stocks that many investors cannot purchase easily? If it is a energy stock like SU or an ETF like EWC, then “fine.” But these obscure Toronto or Vancouver listings require trades that even my Think or Swim account protests. Do we really have that much interest in these speculative wonders, or are we trying to be politically correct and include our wonderful foreign neighbors in this exercise?… Read more »
StockGumshoe
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StockGumshoe
May 14, 2009 6:26 pm

Thanks — about 10 percent of my readers are up North, and many more can trade in Canada with perhaps a bit more cost or inconvenience. It can be a hassle, and I know many folks will never invest in these, but if you’re at all interested in junior miners Canada is where virtually all of them are traded.

Plus, they’ve often got a good sexy story behind them 🙂

Gary W
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Gary W
May 14, 2009 8:05 pm

A newbie question – what are the chances that a penny mining stock is a sham, meaning the company takes your money and disappears, and the mine never existed?

Rod Thompson
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Rod Thompson
May 15, 2009 6:21 am

Ahh, did we all forget about BRE-EX, and their head geologists untimely fall from the helicopter?
Truth is stranger than fiction! small miners are always a huge risk, I wonder if one of the stock picking services / news letters hasn’t picked up their former promotional people, but the market & it’s hype, and just plain old greed keeps the word of mouth marketing system going & us reading these articles and buying in on the open market!
Happy Investing, and may you not pick the next Canadian Bre-ex

boband
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boband
May 16, 2009 10:27 am

Many of the world’s mining juniors are listed on the Toronto exchange and luckily there is only one Bre-X. I have small investments in some interesting companies operating in South America, Mongolia, Mexico, and northern Canada. Not that I would recommend any of them at this moment, but the TSX is the place for this. But I realize for a foreign investor this is not as easy as trading at home.

thealbatross
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thealbatross
May 17, 2009 2:57 am

I did a little sleuthing myself — could Detour Gold Corporation be the miner that fits this profile?

Their website is perhaps one of the most beautifully crafted that I have ever seen — it looks expensive, but if Detour’s claims are correct — then they will soon have plenty of gold to pay for it.

Highlights from the website:

“# 13.2 million ounce in-pit gold resource based on a detailed engineered pit design
# Excellent potential for resource expansion
# Over 250,000 m of drilling completed since acquisition
# Feasibility study underway.”

Bon Chance

Viktor
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Viktor
May 19, 2009 9:32 pm

What about the number of outstanding shares?
Quoted from the teaser: “Using conservative estimates, the potential for my new recommendation’s property is roughly $11.2 billion… which, when you divide by the number of shares outstanding gives you a per-share price of $149.”

So which company qualifies?

Stéphane
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Stéphane
May 25, 2009 11:40 am
clue: he mentions in his report: 1,5 km from another major company solution: The Property The property is located in Kidd Township approximately 1.5km south from Xstrata’s Kidd Creek mine in the Abitibi Greenstone Belt, which is composed mainly of meta-volcanic rocks cut by faults and deformation zones that lie in a northwest to southeast direction. Previous drilling by Xstrata, South of Explor’s property yielded anomalous Cu-Zn values clue: market cap 11,2 bio = 149/share answer: 75 000 000 shares = what explor resources had clue: mentions volcanic sulfide answer: the property only 1,5 km off has also massive sulfide… Read more »
Stéphane
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Stéphane
May 25, 2009 11:43 am

I forgot to say this:

Mccoach talks about the major with market cap of 28 bio

I believe Xstrata qualifies?
any help here?

greetings from belgium

Stéphane
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Stéphane
May 25, 2009 11:47 am

I believe I just hit the spot:::

Shares Issued 2,945.12m
Market Cap £19,305m

Meaning:

19,30 bio pounds is about 21 bio euro’s

is about 28 bio $

“Catching”

I just bought this share 😉

Stéphane
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Stéphane
May 25, 2009 11:51 am

And there is more:

On the drilling map at kidd township there are indeed those 3 drillpoints; but not remarkably there are two extra ones.

meaning this is another hitpoint

Bernhard
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Bernhard
June 28, 2009 9:08 am
I had a look around last night. Always like breaking the code. The facts: 3km from a major explorer A few km from a 28 bio $ mine. Its a relatively unknown junior 2 Properties 3 holes in 2008! VMS found. Found Graphite in 2009 (Test holes) In 2014 the nearby mine will be depleted… One of the properties has an astounding geological story… Scanning the area I found a couple of companies Explor Temex (77 mio shares, 29 ct, close to Timmins) LSG (too big already) WTM (also too big, but interesting, recent find of 80m of 12+ au… Read more »
David Kenyon
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David Kenyon
July 19, 2009 10:18 pm
Australia Gold Rush 1872…..Miners halted in reported 20 oz/t Gold by water inflow at 250 feet. Virgin ground with possible bonanza grades to be mined next year with water flow problem solved. Silver Orchid, needs only $10 million Australian (9 Canadian) to bring this high grade advanced property into production. For full details of the Hill End Project, please see the qualifying report by Dr. Derek E. McBride, P.Eng. January 27, 2003. Dr. McBride’s summary states that “Golden Gully lies in the historic Hill End gold camp that produced the largest gold specimen ever found (639 pound gold “nugget”). For… Read more »
Myron Martin
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Myron Martin
August 16, 2009 10:28 pm

YES there is a Mutual fund that focusses primarily on junior mining companies, particularly precious metals and it has superb management.

I refer to the Sprott Gold and Precious Minerals Fund that made me very good money prior to the 08 sell off and is now making a nice comeback.

John Embry is probably one of the most knowledgable and committed “Gold bugs” in the business!~

Tim Iafolla
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Tim Iafolla
September 11, 2009 12:14 pm

Here are the Sprott Mutual fund holdings–not exactly “juniors”, but a nice list nonetheless:

1 Colossus Minerals Inc.
2 Goldcorp Inc.
3 IAMGOLD Corp.
4 Jaguar Mining Inc.
5 Kinross Gold Corp.
6 Osisko Mining Corp.
7 Silver Bullion
8 Silver Wheaton Corp.
9 Wesdome Gold Mines. Ltd.
10 Yamana Gold Inc.

About half of these are also holdings in GDX.
Sprott is currently in the low 40’s.

Stephan Lombard
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Stephan Lombard
December 1, 2009 9:15 am

I know the answer….check out http://www.thefundametalview.blogspot.com

Stephan
Cape Town South Africa

Josh
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Josh
February 1, 2010 1:15 pm
This is absolutely Explor Resources (EXS). McCoach made a great call on this project as they share very similar geology to Lake Short Gold (used to be two companies, Lake Shore Gold and West Timmins until Lake Shore bought acquired WTM). Explor has some drill holes being announced mid-February and this stock has run from $0.30 when McCoach recommended it up to $1.20 as of Feb 1 2010. Another promising play in the area is Temex (TME) about 5km away from Explor and LakeShore properties with some drill results due to be announced once they complete negotiations with their JV… Read more »
Mark
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Mark
February 22, 2011 1:39 pm

McCoach got it right. Canadian Zinc now up to $1.40 or so. (FEB 23, 2011)

tanglewood
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tanglewood
February 22, 2011 8:52 pm

I don't know anything about mining. I see a lot of comments about a mine being next door to another mine. When things get under ground and unseen, what is to prevent a miner from breaching the property of another miner?

Gravity Switch
Admin
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May 14, 2009 3:25 pm
I don’t know of any ETFs for this, but there are some mutual funds that focus a bit more on small and mid-cap mining companies, though they almost always have a few of the big guys too (funds from Sentry, BMO, and others, and I think I remember that US Global Investors World Prec Minerals fund has more juniors than most). I haven’t looked at any of the funds closely other than to scan their top holdings. There are gold mining and mining etfs from several companies, but as far as I know they’re all market-cap weighted and focus heavily… Read more »
MJay
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MJay
May 15, 2009 1:39 pm

try pinetree capital

PNP on the tsx

regards

Gravity Switch
Admin
11
May 14, 2009 5:39 pm

Thanks Ian — that’s an interesting one, much, much less publicized than Explor (check out the website, it’s largely blank). They seem to have two properties, though not necessarily a match on the three drill holes or the “magma chamber” and other specifics, hard to tell with the limited info.

Still, the more possible matches to throw on the pile, the better. And heck, if it doesn’t match but it’s a better idea, that’s A-OK, too. Thanks again.

Ed Clavelle
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Ed Clavelle
May 16, 2009 11:53 am

Hi Robert Greg McCoach I’m not but I would be interested in knowing this junior you are talking about. I look forward to your reply!!!! eclavelle@sasktel.net or 306-290-8272

ponce
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ponce
May 16, 2009 8:11 pm

Robert, WHAT IS THE SUSPENSE ABOUT? Are you also a newsletter hawker?

Gravity Switch
Admin
11
May 18, 2009 12:27 pm

Coincidentally — nice little article about Bre-X in the Motley Fool today, apparently part of their “scams” series.

http://www.fool.co.uk/news/investing/2009/05/18/famous-scams-what-gold-mine.aspx?source=uoofolrf0010002

nancy
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nancy
May 22, 2009 5:07 pm
What most people don’t realize and didn’t then is that the “order” that was issued to turn in gold said “all persons” had to turn in their gold. The word PERSON, look it up in a law dictionary—it means CORPORATE ENTITY, not a human being. That is the reason for law dictionaries—they re-write the language to mean something other than what it is traditionally. Read a law dicationary, it will open your eyes. The PEOPLE had and do have every right to own anything. They gave up their law and solvency when they were hoodwinked into turning in their gold… Read more »
John
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John
June 13, 2009 4:04 pm

And it is??

Thanks

Yvan
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Yvan
December 1, 2009 10:05 am

It is very simple open a account with a Etrade or Disnat Or so many others and you put a deposit on your account with a credit card and find your self a local address in Canada (mailing address) and that is it many people make it that way they spend several months in the islands in the sun and trade thrue internet,
Have a nice day

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