09/01/2012
December 3, 2017
08/17/2012
December 3, 2017

08/25/2012

Good Job on your gold call!!! how’d you know it was the bottom?

I’ve been thinking that the low for this down move was in place since mid-april and was a bit early. Still, I have a decent basis if this proves to have been the bottom.

I mostly watch sentiment which has been washed out for months now. Between that and listening to the world’s central bankers, it seemed like it was a good spot to add a bit to my already large existing positions. I tend to keep my core position, but buy dips and sell a bit on big moves higher.


I know you own a lot of IPT via EGD, but do you also own some shares directly? Have you followed the company lately? Do you think it’s worth owning separately than EGD to have extra exposure, or does EGD have a better upside anyway (mining’s a hard business, even with Fred Davidson at the helm)? Basically, I’m curious to know what you think about IPT in general. Thanks!

I own a few shares directly. If I had to choose only one silver junior to own, it would be IPT. It’s just very hard to own because I have a bunch of exposure through EGD so I let some go in the high 1’s during the winter. I’ll probably exit it completely as I’ve decided that I no longer want to own junior miners–even ones with lots of cash flow and strong balance sheets. That said, if you want silver exposure, this is the one to own.


Hello Kuppy,
After spending a couple of years in Mongolia, how is your health holding up to the pollution?

It’s not what it should be…. They really need to do something about the air here.


What was that very cool van you were traveling in?

I think that’s an old Russian van. We were in something with brakes and shocks…


you think the underwriter of the recent stock offering is going to get off their butt and write up what this new deal means for EGD going forward??

That would be truely canadian–an upgrade while trying to sell their block of shares shares? Probably get an order of Canada medal for doing such a thing….


Hi,
I’m curious as to your thoughts on Energold regarding their accounting.

Mainly:
1- Why is cash flow from operations negative?
2- Why aren’t they making money in Canada, their home jurisdiction?

I see a lot of red flags with this company. I’m curious as to what you think about things about Energold that don’t seem to make sense. Am I totally off my rocker here?

I will vote for ‘totally off your rocker here’

Cash flow from operations is negative because they’re growing so damn fast and their receivables are ballooning. Days receivables outstanding has stayed relatively constant for years, so there is no cause for concern. In a very rapidly growing business, you should expect that cash flow from operations will be lower than GAAP profits. As the growth rate slows, cash flow should really ramp up.

They don’t make money in canada because until they acquired Bertram, they had no operations there except for a corporate office which costs money to file public company documents and manage the company.


Would REITS do well in an inflationary environment? I’m assuming they have long dated fixed rate debt. Thanks.

In an inflationary environment, if you can borrow long in fixed rate debt and buy hard assets, you should do very well, especially if you can pass a lot of your costs through to your tenants through a triple net lease.

For REITS, you really need to analyze each particular company to find the right ones with these characteristics.