The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
I have still quite a few shorts on FTSE, Wall St, and Spain. It is basically Wall St that we are waiting for. It is the earnings’ season coming up again, so that should push things, one way or the other. Spain dropped more today – which is interesting – it is basically toast, but recently it has often performed better. Fascinating times ahead.
Hi Guys My approach is that I have a big lump in Zurich which I consider currency. I constantly deal Spot gold CFD’s with the general premise that the price will increase. Thus, I move, in and out, as the prices ranges from day to day. Generally, there may be a slight [?] dip again, but longer term – both currency-wise, and dealing-wise – the only way is UP!! NB I use the exactly-opposite rational when dealing Wall St. and FTSE. PS It is interesting to note – with respect to the European bourses – that Spain and the UK [the most dodgy to my mind!!] often reflect a more bullish position in inter-day trading. Just worth a thought. ATB.
When is the big drop coming, guys?
Gold will be OK :) No problem!! However, what I’ve noticed, recently, is that the FTSE is trying to show that the UK is stronger than Frankfurt, or Paris, when, and that is even before, the Wall St. hypnotism kicks in. What a joke! It will be interesting to see how this pans out, when our increasing sad, economic position slowly unwinds ATB
4300 or less would be great :) Also hoping for a big retrace - even nightmare - on Wall St.
Old King Coal still has a role http://www.investorschronicle.co.uk/MarketsAndSectors/Sectors/article/20090603/59bca73a-5019-11de-b1d6-0015171400aa/Old-King-Coal-still-has-a-role.jsp
PS Not waving......but drowning!!!!! PPS I thought he was ON something!!!!
Investing is far more of an art than a science, therefore rigidly following a system will fail! One has to feel, empathise, using years of nous. It is far more about “free will” than determinism. It is about head and heart, combined, with a massive amount of good fortune thrown in!! But I think I’ve mentioned this before...............
Interesting article that I filed a while back, can remember from where, I'm afraid! Gold Price Setting. Twice a day – at 10:30 am and 3pm - the price of gold is set on the London market by the five members of the London Gold Pool (HSBC, SocGen, Deutsche Bank, Scotia-Mocata and Barclays). This is known as the London fix and it’s used as the benchmark to price gold, gold products and derivatives in markets around the world. I’ve been looking at some charts and an astonishing pattern has become apparent. It’s a pattern which, if you’d traded it methodically, would have earned you 1% a week over a period of 24 years. That compounds to a staggering 24,720,000%! The astonishing pattern in London gold fixing The strategy is really quite simple. You buy gold at the London PM fix (3pm), as the American markets have just opened for trading, and you sell your gold the following morning at the London AM fix (10:30am), as the Asian markets are closing. My thanks, as always, to Tom Fischer of Herriot Watt Uni for the charts below. The first demonstrates the weekly 1% gain that would have been yours since 1985 (the green line). And, as our next chart shows, if you reversed the strategy, bought gold at the AM fix and sold at the PM fix, you’d be down a bankrupting 0.67% per week. What is more astonishing is how this pattern has accelerated since 2007. Sell gold in the morning, buy it back in the afternoon, and a cool 1.78% weekly profit will be yours: Do the opposite, however, and you’d have suffered a weekly loss of 0.86%, despite the fact that gold is in a runaway bull market. The trouble is, of course, that transaction costs all but invalidate this strategy. But there is nevertheless a great deal we can read into this pattern. Why would anyone want to manipulate the gold price? What other free market shows such a consistent behaviour over time? Unless, of course, it’s not a free market and the invisible hand of Big Brother is getting involved. Many of you will have read about manipulation of the gold price, and heard that there is a deliberate conspiracy to suppress the price of gold. Every time I hear the words ‘manipulation’ or ‘conspiracy’, my every instinct screams ‘No’. There must be a less Machiavellian solution – most conspiracy theories are poorly researched and facile. But several people have done excellent research into this one, including James Turk of Goldmoney, the people at GATA and Paul Mylchreest in his Cheuvreux-Credit Agricole Report. Why would anyone want to manipulate the gold price? Well, despite the fact that it is of barely any industrial use, gold is a highly political metal and a runaway gold price – which, by the way, we will eventually see, I am sure – tells you ‘something is rotten in the state of Denmark’. If people are rushing to buy gold, it shows they do not trust the ability of the government to maintain the value of paper currency. So the aim of the manipulators, the theory goes, is to devalue gold and preserve the status of unbacked government currencies such as the dollar. One reason for the theory is that there is more gold and silver sold on the Comex than is actually possible to deliver. In the case of silver, more is sold than is actually mined on an annual basis. And certainly, the remarkable trading pattern of the London PM and AM fix adds more weight to the theory that the West is selling gold during Comex opening hours, possibly to suppress the price. On the other hand, of course, we have Occam’s Razor – lex parsimoniae. This is the principle that the simplest solution is the best. So rather than resorting to some mass conspiracy theory, could the answer simply be that Asians are buying gold and Westerners are selling just because Asians like, value and appreciate gold more than we do? Whatever the reason for this price pattern, this transfer of gold from West to East is yet another demonstration, if you needed it, of the generational shift in wealth and power that is taking place. After all, they say that ‘he who owns the gold makes the rules’. An interesting statistic for you Finally, before I go, here’s an interesting statistic for you: the first fixing was in September 1919 when the gold price was four pounds 18 shillings and nine pence per ounce. It’s now more than £600. My, how well sterling has maintained its purchasing power. Here’s a chart that tells you what a rotten investment the British pound has been ever since we came off the gold standard in 1914. It comes from a House Of Commons Research Paper (03/82 11 Nov 2003) – so they know. That decline, as we all know, has accelerated somewhat in the last six months. And the reception to the latest banking bail-out suggests it won’t stop falling any time soon.
I was wittering on, a while back, that the UK needed to re-assess its position on this fuel, of which we have scuttle-loads. An interesting article: Why coal could soon be back http://www.moneyweek.com/investments/commodities/why-coal-could-soon-be-back-14679.aspx?utm_source=newsletter&utm_medium=email&utm_campaign=Money%2BMorning
Monaco. Thanks for that. Yes I am very bullish about gold. I have around £100K in bullion, [bought about 2 years a go, @ under $450 per oz.] As with all topics, there is a wide range of comment [most with very little cerebral input – do you read some of the BBs on here? :)]- from the "conspiracy theory brigade" to the laissez-faire “happy talk” air heads. Gold, as you will know has eased back, somewhat, but still in “real terms” has been a tremendous investment. I am hoping that it does not drop below $900 – although I would not be overly concerned. It simply, gives one buy/sell opportunities with spot gold contracts. Gold will really come into its element, if the various glubbermints start this nonsense of Q.E. ATB P.S. I often post relevant articles on the AVM BB. P.P.S I think I read somewhere that - relatively to the price of Au - good quality gold shares are also seriously under-valued! P.P.P.S I'm also "given to being a bit crazy!!"
I think so. We are going through a silly stage” buoyed up by false euphoria. So, for instance, retailers, pubs, auto parts, builders’ merchants, are bouncing – some up over 16% - pure nonsense. So I’m simply waiting for the next “reality check” Just a few articles from today! The "doom and gloom" hasn't gone away! GOP lawmakers take issue with loan modifications Concerns raised by about bill to let bankruptcy judges alter mortgages http://www.marketwatch.com/News/Story/Story.aspx?guid=d08d446a152d4e5e86390814278c8945&siteid=nwhpm&sguid=EN_9oCaFWka-rv4Qp1Letw Savers withdraw record amount from banks http://www.telegraph.co.uk/finance/personalfinance/savings/4799679/Savers-withdraw-record-amount-from-banks.html Japan exports drop 46% in January http://news.bbc.co.uk/1/hi/world/asia-pacific/7909248.stm
Didedo I’ve just noted in this week’s I.C – I’m a slow reader - that there is an article, “Uranium glows ever hotter” The stage is set for a bull market in uranium, according to some analysts. The paragraph titles include: North Sea reserves are dwindling fast; Clean coal not yet there; Gas supply uncertainties; Nuclear the only viable option?; and, Opportunities for uranium miners. They highlight KAH & URU
I didn’t realise that this BB existed. I am very bullish about gold. I’ve got gold fillings, gold earrings… no, not quite, but I do have a large lump of gold through Bullion Vault, and I have made lots out of spot gold contracts - in/out - believing the general trend to upwards. It tends to drop as the markets do well and vice versa. It has done, especially well, sterling-wise. Cronus and I have had an ongoing chat on AVM BB for quite a few months, about gold, and especially in relationship to the concept of “quantitative easing” of fiat currencies – which can’t work because everybody is playing the same silly game! We have also posted lots of links to relevant articles. I think that there is a lot of mileage left in Au - there may be dips on the way, of course. However my bearish outlook for the economy is stag[hyper]flation. If that is the case then gold will only go one way. I’ll check back here form time to time ATB P.S. Can’t make up my mind whether to have a bit of fun on the JJB BB tonight or not. :) Easy12 Are those golden candlesticks?
The biggest nuclear power generator in America today is Chicago-based Exelon (NYSE:EXC), with 17 plants spread across the country.The company has just announced a 26% rise in its fourth-quarter profits on the back of increased nuclear power output and lower purchasing costs. Exelon took a dive last year – falling 38% – but Macquarie analysts maintain a price target of $82 on the stock, a 48% uplift on its current price.The stock is valued on a forward p/e of 13 and offers a healthy 3.8% dividend yield. The dividend is also well covered by earnings, according to Robin Goldwyn Blumenthal in Barron’s. For the more adventurous, Redhall Group (Aim:RHL) is a small decommissioning specialist operating in Britain. Redhall shares took a 20% dive on Friday after it announced the collapse of an oil rig contract expected to contribute £1m to operating profit this year. But the firm’s business is still growing strongly – it reported pre-tax profits up 95% in the year to September and an order book that has swelled from £64m to £110m. It also has debt facilities available through 2014, according to Growth Company Investor. Redhall Group trades on a forward p/e of 8.2 and dividend yield of 2.2%.
Nuclear energy will deliver hot profits by Eoin Gleeson Having repeatedly slammed the door in its face for two decades, the government has welcomed the nuclear industry in from the cold. Business Secretary John Hutton recently announced his formal backing for a new generation of nuclear power stations. Within days, European power groups were checking out potential sites around the country. French energy giant EDF has already announced it wants to build four new plants here. And German power groups want to invest £20bn building four of their own. Meanwhile, in America, where no new plant has been built for 30 years, nuclear could make a grand return. Indeed, there are 17 applicants seeking approval to build 26 nuclear plants in America, according to Robin Goldwyn Blumenthal in Barron’s. But these plants are not going to be built overnight. At best EDF says it can deliver the first of its new plants by 2017. And there are doubts over how some nuclear groups will raise all the required capital. Central bank rates may have fallen, but the cost of project finance has not, explains Forbes. And the cost of building a nuclear plant is spiralling – with construction costs rising 185% between 2000 and 2007, says Joseph Romm in Salon. Over in the US, a new reactor costs about $13bn, which is a good bit more than the entire net worth of many companies looking to build a new plant But the good news for investors is that they don’t have to wait for a grand nuclear renaissance to cash in on nuclear power. Take the power firms running the 104 existing plants in America, for example, says Goldwyn Blumenthal. Not only are they cheap and paying healthy dividends, but they’re also in prime shape to see out the recession. The cost of producing electricity at a nuclear plant costs three times less than a gas plant, for example. Moreover, the cost of the key raw material has tanked – uranium fell 50% last year to $53 a pound – and nuclear firms are set to benefit if US President Obama decides to impose a carbon tax. So “owning companies that already own nuclear is the sweet spot for investing in utilities”, says Mark Fin, utilities analyst at T. Rowe Price. And then there’s the job of dismantling the old reactors, a thriving business in its own right. Over the next 15 years, Britain plans to shut down all but one of the ten existing nuclear power plants. The big nuclear operators rely on groups supplying dry-cask storage to store their waste on site – high tech containers with 150-ton concrete and metal cylinders that seal in the spent fuel. They also rely on specialist engineering groups to dispose of waste and dismantle the site. As such, the Nuclear Decommissioning Authority has announced an £8.6bn budget for the period to 2011. Long term, however, it’s the firms that supply uranium and build reactors that are the best play on nuclear. According to the International Atomic Energy Agency, 630 reactors will be operating in 55 countries by 2030. That will nearly double the world’s appetite for uranium. Whichever firm cracks the design for the next generation of reactors – Areva and Westinghouse are prime candidates – will win big. That’s because governments know that if they are to meet targets for carbon emissions, nuclear energy is “the only viable, immediate and ready to roll solution”, says Jason Makansi, author of Lights Out. But for now, with credit shortages and high costs stinging plans for new facilities, businesses that run and dismantle existing reactors are the best plays. We have a look at two in the box below.
Didedo Still not sure re: posting about Uranium under Oil/gas. It suppose it is an energy source. I note today that MoneyWeek is running an article headed “Nuclear energy will deliver hot profits.” If you are unable to locate this. I could perhaps, see if it’s online, and will post later.
Perhaps one need “KID-gloves” handling some of the characters on these boards [maybe even a double-entendre there!]
Always have ones Geiger-counter to hand!
So, in my mind, the whole uranium consolidation story really could turn out to be an enormous white elephant. It will, however, continue to generate froth and you could very well make some gains in the process. But bubbles always burst… So make sure that the uranium company you back is not just an explorer but is a producer as well. At least it will be generating cash – and won’t have to pass the hat around too often. GarryWhite is editor of Outstanding Investments, which focuses on commodities, energy and infrastructure. He earned a degree in genetic engineering and initially used this science background on projects in the UK and Africa before being attracted to the bright lights of the City of London. Following a wide-ranging career that included a 5-year stint at Standard & Poor’s reporting on pan-European equities for traders and fund managers worldwide, he now focuses on strategic investing in some of the hottest sectors around to. Hi Didedo It is an older article, but still has relevant. Take care!