11/22/2010
December 3, 2017
11/18/2010
December 3, 2017

11/21/2010

Hi Kuppy, Please send me information on how I might invest in your fund, what is the minimum, etc.

You’re a few years late…Where were you five years ago when I was trying to raise money?

I haven’t said it lately, but the fund is closed to new investors. I expect it to remain closed indefinitely.


Kuppy,
Great piece on BDsec.
From a diversification standpoint the fact that one must open an account in Mongolia is quite attractive to me.
Along those lines, are you concerned about increasing capital controls in the future?

I’m an investor, I’m concerned about everything that can happen. I think there’s a very good chance that there are capital controls at some point in the US, unless we dramatically change the direction that we are going with things. The last step for bankrupt governments is to try and trap the remaining wealth inside of a country. Everyone else has tried it when they got desperate. We did it not too long ago here in the US. I’m sure we will try some variation on that again in the future.


I’m doing other things on the fly but thought this company may have interest for you for many reasons except for the time horizon to fruition……..
http://www.polarmin.com/

I’ve heard of them. I’ve heard many good things, but I don’t know the details. I am not too bullish on building demand in the near term. If I thought demand would return in the next few years, I’d certainly be looking at this closely.


Kuppy
Curious why you think so many investors hate mining stocks?  Is it just the mgmt piece?  Mgmt just sucks!!

It’s everything. Until you have a mine with cash flow, you have a hole in the ground. A lot of these management teams promise you the world, but have no idea how they will accomplish anything. You shouldn’t have a geologist running a company. There are a billion ways you can lose. Of the 5000 junior miners out there, less than 10 % will ever become mines. The odds are just horribly against you. It’s pure venture capitalism and they constantly have to dilute you along the way. Even when they build the mine, you usually end up getting so badly diluted that there’s no upside for you. You have to really know what you’re doing in this space and you need to invest in guys that you can really trust. I just haven’t found too many companies like this. I have gotten to the point where I’ve pretty much given up looking, especially when I have better ways to invest in mining like Energold. Let someone else put holes in the ground all over the place. I’m getting paid to own the drills.


So, I’m guessing that there may be many folks interested in investing alongside you, be that in Mongolia or wherever, but just what kind of Investor is BDSec looking to receive? Would it be for investors other than Accredited Investors, who diversify and enjoy being at the start of a Frontier boom (money wise)?

I realize that “If you have to ask, then you aren’t the right kind” may apply here, but I agree with you that this kind of setup in Mongolia may not occur again elsewhere, and I’d like to think that just because there are more hoops to jump through, the opportunities are nonetheless real.

Thanks for all the information you share, it’s been a pleasure investing alongside you.

BDSec is a broker. If you want to open an account to invest in Mongolian shares, they are one of many options. I chose them because they have english speaking client reps and as a foreigner, I wanted to go with the largest broker because it made me feel safe. I have my own account there. They never asked me if I was accredited. It was just like opening any other account that I’ve opened over the years. Hope that helps.


Probably not your style but if you have the itch for emerging markets take a look at VNM as it is about the only emerging market that is, collectively, not at nose bleed levels.

Quite a few very smart people have now told me that I need to look at Vietnam. Marc Faber had a great piece on it this month in his letter. I should probably make a trip over there. I ran out of time when I was in Cambodia/Thailand last time. I’m not the type to buy an ETF though. I’d have to find some company or group of companies that I really liked. Sometimes, there aren’t enough hours in the day….


1) on one of your first blog posts, you mention a bad experience with Western Prospector. What happened? I tried looking up the company, but it doesn’t exist anymore
2) on BDSec, I was looking at the historical price. In 2006, the share price dropped from 2K to 100. Is that accurate?
3) can you tell us any other companies you’re invested in or looking at in mongolia so we can do some dd ourselves as well?
love the blog. it’s one of the best i’ve read online.

1- I owned shares of Western Prospector (a uranium prospector with a very good asset). Shares went from a dollar to like 6 or 8 or something. Then Mongolia changed their tax law and introduced an excess profits tax and WNP went back to a dollar. Not much fun at all…. I don’t think I lost money, but I had huge gains that disappeared overnight.

2- I have no idea if it’s accurate or not. It’s probably a bad quote.

3- I own shares in a few Mongolian companies now. I don’t feel comfortable enough about any of them currently to talk about them.