December 3, 2017
December 3, 2017


Just landed in Tokyo…

Has AAG’s announcement today changed your view of the co.?

It’s pretty frustrating. That’s for sure. I had a hunch that capital costs would increase, but this is a bit much. I’m more interested in the community agreements. While costs are up, so are metal prices. It’s still a very valuable mining asset–but it’s worthless without agreements. I absolutely hate mining and this is why. No more jr mining for me ever again. It’s just not a business.

There’s lots of value here and roughly $20m of cash. That should limit the downside from here. I think the smartest thing would be if the company put itself up for sale and let someone else work on these community agreements. Clearly these guys cannot get it done.

The only good news is that the drop from a dollar to 25 cents has made this an increasingly small position for me. I’d much rather express all of my mining view through Energold going forward….

Hey Kuppy,
Thanks for providing a platform for individual investors to listen, learn, and interact with a hedge fund manager.
Do you have any knowledge or opinion on Comstock Mining (LODE)? I know you are staying away from juniors but this is unique due to its historical drilling success (from 1800-1890) and recent permitting activity. I’m not a geologists but according to their recent NI 43-101 report they have approx. 3 million ounces of gold and an even larger silver reserve.

No Jr Mining ever again for me. sorry

Actual quote from an OWS protester by the Toronto Stock Exchange:

“It’s weird protesting on Bay Street. You get there at 9 AM and the rich bankers who you want to hurl insults at and change their world view have been at work for two hours already. And then when it’s time to go, they’re still there!  I guess that’s  why they call them the one per cent. I mean, who wants to work those kinds of hours? That’s the power of greed.” – Jeremy, 38

This was sent by a close friend of mine. It’s just too funny not to pass along.

Kuppy–You don’t seem to be revealing very many of your actual positions. Why is that? If you want more feedback, give us something to chew on.

I really don’t have very many positions right now. There are times to really be greedy and max out your exposure and times when you are best off doing very little. There’s lots of things I’m following, but most aren’t interesting enough to really get excited about them. I basically have a ton of Energold, a decent sized position in MERC and then my greatly reduced AAG position, some physical metals, small VXX exposure and my mongolia exposure which is also quite large. I wish there was more to do because I’m one third cash, but I cannot seem to really get excited about much right now.

Hi Kuppy,
I was wondering how many times you have so far read the Security Analysis.

Just once. Financials are backwards looking, everyone can analyze them (especially computers). You need to be able to look into the future and that’s where the big upside is. That’s much tougher and where everyone ought to focus…

Hi Kuppy,
I picked up a copy of the Grand Strategy about which you stated “This is by far my favorite book about finance, portfolio composition and economics. If you do not read this, you are a seriously missing out on one of the greatest finance books of all time”.
I’m about 60 pages into it and I’m wondering what I’m missing or if the best is yet to come? Although the Roman offensive/defensive strategies are somewhat interesting, I’m drawing a blank on how this applies to economics, finance and portfolio composition except in the vaguest sense. Perhaps in a future post you can expand on this? (Again, as I mentioned I’m only 60 pages in, but I suspect by now I should have picked up on the relevance.

It’s the best book about strategy and portfolio composition because it’s so abstract. Too many financial types spend all their time analyzing other financial situations. Here’s a real critical view of how Rome Inc. was ran to maximize tax revenue and minimize defensive expenditures. Why didn’t they capture Germania? There was nothing really there worth owning. Same goes with northern Britain. But you don’t realize it until you read the book. You have a portfolio of property and you must maximize your returns. The economics of strategic defense are simply fascinating because of the real world implications to the stock market 2000 years later. It’s all about learning how to think critically and using lots of different models, not just stock market valuation in your analysis.