This is a pre-market and abbreviated edition of Morning Musings today due to travel commitments…Gold has been in positive territory during overnight trading…as of 3:00 am Pacific, the yellow metal is up $13 an ounce at $1,629…Silver is 31 cents higher at $30.98…Copper is 4 pennies higher at $3.27…Crude Oil is flat at $82.42 while the U.S. Dollar Index is up one-third of a point at 78.21…European and Asian markets are showing some weakness while Dow futures are off nearly 130 points…
Investors will be focused on some key U.S. economic numbers out today…personal income and consumption data for August will be released at 5:30 am Pacific…this will be followed by the Chicago purchasing managers report at 6:45 am and consumer sentiment at 6:55 am…St. Louis Fed President James Bullard speaks at 11 am in San Diego…
The world’s policymakers are in the driver’s seat and they are taking investors, companies and the global economy for a wild ride, according to Pimco CEO Mohammed El-Erian in an interview on CNBC yesterday…”Policymakers are in control today and they are driving this car very erratically; they’re not even telling you what the destination is, especially in Europe; and instead of looking through the windscreen, they’re arguing among each other…it feels really volatile and unsettling,” said the co-chief investment officer for the fund with $1 trillion under management…
One of the most volatile and difficult quarters for investors since late 2008 and early 2009 draws to a close today…the CDNX has plummeted 422 points or 22% this quarter entering today vs. an 11% decline for the Dow and a 12% drop for the TSX…the TSX Gold Index, meanwhile, is up 6%…what’s particularly troubling is that the CDNX, an extremely reliable leading indicator for the broad markets and the economy in general, has gone beyond what would be considered a normal and healthy major correction and appears to have reversed into a bear market…last week’s drop below the August low seems to have confirmed that…the CDNX has been in a slump for nearly 7 months and is down 35% for the year…we’d like to be able to say a reversal is right around the corner but the fact of the matter is, the Index has broken down…the recent technical deterioration in this market now makes it almost inevitable that the CDNX’s important 300 and 500-day moving averages will reverse to the downside at some point during the upcoming fourth quarter…the last time this occurred was just before the Crash in 2008…in retrospect, one could argue the bear market actually began back in March when the CDNX suddenly pulled back nearly 20%…the questions are, why is this happening and what does it mean?…we’ll be exploring that in more detail in the coming days but one very possible conclusion is that the global economy is in for a shock, that government and private sector economic forecasts for “slow growth” in the coming months and no recession are simply wrong and wildly over-optimistic…the recent weakness in Copper (it broke below important support) adds credence to that argument…
At the moment, the CDNX is trading within a support band from 1400 to 1500…as John’s updated 2.5-year weekly chart shows, the Index is clearly in oversold territory (based on RSI) but this condition could persist for a period of time just like the 2010-2011 overbought condition lasted for several months…
John has also produced a chart for the Volatility Index which of course is an important gauge of investor fear…John says we need to keep a close eye on the VIX as it potentially could be ready to bust out to the upside…we wish we could be more positive this morning but we need to call ’em as we see ’em…
TIMBER !! This is likely gonna get ugly but it would be great if this market could avert disaster.
An opinion on why the $CDNX sold off huge in March and never recovered into the seasonal May sell off – There was a huge amount of paper pumped out in financings in 2010, the last of which came free trading in late March and early April. Sitting on solid gains, intelligent investors took the money and ran after which the sell in May effect kicked in and here we are today 7 moths later.
Worth a watch: Doug Casey interview http://vimeo.com/29058918
Comment by Justice — September 30, 2011 @ 6:43 am
Great interview – thanks for sharing.
Comment by Hugh — September 30, 2011 @ 10:31 am
GBB advanced 2 cents to close at 29.5 cents. This can only be a one day shine, nothing exciting as I believe that it will go down to 25/26 cents level. BER also slow and closed at 14.5 cents – just wait. TYP dropped to 54 cents … that is too much and I scooped another 10,000 shares. VGD closed at 25 cents – continued to drop as lack of buyers. NAR closed at 12 cents with some dumping and the next resistance point will be 10.5 cents… This stock has reached the bottom and I think it may not go further down. SFF unchanged at 19 cents and this stock also came to buying point.
Comment by Theodore — September 30, 2011 @ 1:03 pm
Guys.. I am an experienced investor… but I dont give advice just my thoughts and opinions…. I have sold 20% of my portfolio over the last 3 days as a hedge. I tried to only hit the bid when the spread was small… but SOME of the peeps out there don care… they hit the bid and have been for the last 8 trading days except for one. CQX… down 2 (20%) on 2600 shares… really???? THIS the reason that stocks decline in a low volume environment. and this is where the money is made.. I know an oxymoron right??
I wait for the lows.. problem is.. when is that going to be.. some buying coming in slowly.. but still low volume…
All BMR stocks will go as low as they go… until the CDNX shows any sign of life, or gold drives higher we are in for a slow bleed like 2008 and for the same reasons … fear!! If I could rely on the sentiment of the other peeps out there I wouldnt havent sold anything… but then I would be dreaming..
there I feel better:) thx for listening
Comment by Jeremy — September 30, 2011 @ 2:13 pm
BTW … we’ll see how much of a mistake it was later:)
Comment by Jeremy — September 30, 2011 @ 2:13 pm
Fear is gripping the market. People are already positioning as if the recession is going to happen. That prospect is getting likely each day BTW. However, I think the rate of that has been severe last few days, possibly people fleeing with 2008 in mind.
There is just little buyer for the junior stocks. That is forcing some stocks to plunge intraday when someone tries to sell just few grand worth of stock. It was looking ugly this morning because if more people started dumping, there is no knowing how far the stocks will drop.
Anyways, some stocks recovered toward the end of the day. I expect continual decline next few months with interim bounce up in the near term.
Comment by Bruce — September 30, 2011 @ 3:17 pm
Thought for the day………
This is not the time to panic…….in fact, there is NEVER a time to panic.
Comment by John - BMR — September 30, 2011 @ 3:36 pm
It’never time to panic John… I think your are drinking to much of your biblical wine ! Did your wife tell you back in march to not loose to much of the family money. Did you listed to her ?
Comment by Andre — September 30, 2011 @ 4:10 pm
Andre,
you make it very hard to keep the content of this board to what it was designed to be about, exchange of info on mining stocks. BMR has made it very clear in their statement what they are about, if you do not like that or it offends you, guess what?, you have the choice of not logging on to this site and reading the material they FREELY give. I find it very offensive of you to come on here and post the offensive things that you post to John and others because of what they may or may not believe in. We are all adults here and we do not need you to protect us from our investment decisions, so please do all of us a favor and keep the personal attacks to yourself.
Thank you
Comment by GREG H — September 30, 2011 @ 8:15 pm
Greg I think you mist a excellent occasion to stay quit. I don’t get involve in yours multiples postings so don’t get involve in mine.
Comment by Andre — September 30, 2011 @ 8:24 pm
André, move on and find another site if you do not like the advice given here! it will be better for your health!! 😉
Comment by M. — September 30, 2011 @ 8:51 pm
Andre
If you are as good of a trade as you say, why spend your time reading site that gives bad info. Why would you bring Johns wife into this?
Comment by jimmy — October 1, 2011 @ 5:24 am
Better for my healh…. ? Please explain M. Now for the wife… I am using one of his comment in March where he said his wife told him to not loose any money during the summer.
Comment by Andre — October 1, 2011 @ 6:14 am
Well if any of you follow Don Coxe which I know BMR is aware of him, he recently put out a new Basic Points (September edition). I encourage you all to read it. It has an interesting section on how this sovereign debt crisis could be contained or fixed. Since the US is the largest holder of gold reserves, Don believe it would be smart for the US and other countries to fix the gold price (at say $2200/oz) and sell a portion of their holding to pay off their debt. This would bring back fiscal stability to each country and contain the runaway debt levels of each country. He also mentiones that having gold backed bonds for the PIIGS countries would help provide certainty for countries to issue minuscule interest rates on their bonds.
There’s also a good blurb in his basic points indicating that gold bullion has performed slightly better than the S&P over the 40 years.
Here’s the link:
slideshare.net/ram2099/don-coxe-basic-points-sep-2011
Comment by Andrew M — October 1, 2011 @ 6:19 am
Ladies and Gents… panic is only necessary when the building is on fire… and I believe smoke is being smelled. whether its a BBQ or a fire who knows.. but the perceptions of the market is its fire.
Black swans happen all the time.. Bernanke was our black swan.. 200K gone in the space of 4 days… changed everything.. panic?? most did…
you are going to lose and then win then lose, and as I have discovered, you need a constant exit plan..
if I was 30 man it would be all different… but I’m not. many questions and uncertainties abound..
but the one thing I have learned painfully so is that everyone wants your money and will do anyting to get it.. legally or not. BMR tries to guide to areas to make you dough and when to execute your plan of exit.. remember at 2300-2400 John said a possible correction to 1600 and change .. man did we laugh…. gulp!!
My suggestion to you all is to think about that plan of exit, and when you take some dough outta the specs, maybe you shouldnt put it back in.. it might really hurt if you do… just sharing:)
now having said that… ABI… JOn… another Greencastle?? or still a really good patient ‘opportunity’?? if you have lost 50% on this one is it best to cut your losses?? or ride the storm out..
just looking for opinions:) TIA… Please let Oct be the start of something positive…. I jumped off the ledge Friday… onto my deck:) 2 feet but symbolic:)
Comment by Jeremy — October 1, 2011 @ 7:11 am
Asking for an advice leads to problems. Inevitably, blame goes if things don’t pan out.
I didn’t like how GQC was trading and got out close to 20c before the news came out. There was an opportunity to get out at a decent price after the announcement. BMR doesn’t give you sell timing so you are on your own.
Comment by Bruce — October 1, 2011 @ 8:54 am
Jon, I’m not panicking and never do! 🙂 AGE has deep drill results due end of October and if they hit could revive that stock. VGD is just waiting for the remainder of the Wasamac results. I think Martin Dallaire has done his best to keep shareholders updated in the recent market decline. However, as you advise we have to be prepared to preserve capital for this final quarter at least. Much as I would hate to sell my holdings in AGE, VGD and CUI perhaps it is the sensible approach and wait for the bull market to return and then climb aboard again. For those who take this approach do you have any thoughts on trading ETFs – there are an abundance of them and some suited to a bear market? They could be a vehicle to recoup some losses and be prepared to reinvest in the juniors or even a stellar stock like RIC when the technicals are in place? Thanks.
Comment by Andrew — October 1, 2011 @ 2:07 pm
Andre (Andy80 on Stockhouse), is famous for bashing GBB on stockhouse…..the only stock he bashes…even though all other juniors are having problems staying afloat….he is either a paid basher or wants to get some cheap GBB shares. Take a look at stockhouse….wonder why he only chooses to bash GBB?? And now trying to discredit John?? Shame on you Andre…I put you on ignore on stockhouse but unfortunately there is no ignore button here!
Comment by Maria — October 1, 2011 @ 2:21 pm
Maria Maria Maria. I have been out of the markets since March. GBB is for me a excellent stock to trade. the stock goes down I pick it up and fanatics like you bring it back up. goes back down again and I …. Well you guest it. Over 30 000 dollars in gains this year. Your treating GBB if it’s like a living creatur. I feel very sorry for you. I known you are a good person but I think your immature thinking will ruin you financialy. Your going to have to learn the hard way beacause your treating your Investment in GBB like a drug addict or someone playing with a Slot machine and hopping that it will pay out soon. I think you will have to hit rock bottom before you wake up to realise the danger in investing on the ventur and in your cAse putting all your money and your husband in only one stock….GBB. I sincerly wish you good luck. Your friendly Andre.
Comment by Andre — October 1, 2011 @ 6:08 pm
Andre….if I were to hit rock bottom….my God will pick me up (like he always does) and that is why I am at peace and do not worry about my investments…..it’s in HIS hands….I hope one day I will hear that our good Andre has become a Christian. By the way, you asked John if he was drinking church wine…..evangelical and other protestant churches do not have wine but grape juice. As for GBB….time will prove it’s worth. I have a good job and I don’t have to sell any stock to pay my bills, I am in for the long term with this stock.
Comment by Maria — October 1, 2011 @ 9:29 pm
Maria
read Matthew 7:6 you will understand.
Greg
Comment by GREG H — October 1, 2011 @ 9:37 pm
Maria Don’t you think your god like you say, should take care before of the milions of kids that are dying of starvation, sickness, in Somalia an many others countries in the world before thinking of your single investment in GBB ? .Now your god, if your are listening the news since 20 years , is shurly not doing a good job at this point to help those dying kids. So why would he do a good job with your investments ? . Why do I go there with you people !
Comment by Andre — October 2, 2011 @ 5:01 am
Andre, you will find the answers to your questions in the bible. Take time to read it!
Comment by Maria — October 2, 2011 @ 11:09 am
Andre is also the cancer of the stockhouse gbb board known as andy80. No one listens to him there, but unfortunately they have no ignore button on this site. The guy has been proven to be a liar on stockhouse, and he lives in a fantasy world. Sad really.
Comment by mike — October 2, 2011 @ 12:20 pm
Very Vague answer Maria… I think you realy need help and why don’t you invite Mike and Greg H. Maybe You could get a groupe discount with a local psychologists.
Comment by Andre — October 2, 2011 @ 1:39 pm
lETS GROW UP AND STOP THE BICKERING. THE FACT IS ALMOST ALL MINING STOCKS ARE DOWN THE GOOD THE BAD AND THE UGLY IAM SURE THERE WILL BE A TURN AROUND AND THE GOOD STOCKS WILL SOAR TO NEW HIGHS.THE TEAM AT BMR WILL AGAIN BE IN FAVOUR. THAT IS MY PERDICTION
Comment by gil — October 2, 2011 @ 1:58 pm