Bitcoins are dead, Rare Earths are ‘alive’ and FDIC vs. Libor to re-build trust for the ‘little people’?
“Bitcoins? ‘Smash’ — it’s over for now…” starts Rockstar as he proceeds to ask me why I am not covering more tin plays as he is bull on tin. Obviously, not having read Robin Bromby’s nearly weekly tin updates for the last month (Bolivia to its lithium promise, add that other technology metal — tin), this provides me with an opportunity to explain that Robin will be in France for the next three (3) weeks, on something I have seemingly only read about – a vacation. I turned the conversation to the U.S. Federal Deposit Insurance Corp. (FDIC) attempting to make 17 banks and an industry group accountable over its alleged participation in interest-rate rigging via the London interbank offered rate, known as Libor. I am trying to get Dr. Luc Duchesne to wrap his head around the impact of this lawsuit and to create the algorithm needed to determine how much each of us in North America should receive in compensation to right this inevitable wrong, not to mention…re-establish our trust in capital markets?
Speed-dialed another secret source in the southern States, as it seems everyone will talk to me off the record, and he responded this way: “Look, we knew about the manipulation of Libor 4 years ago, and it’s simple — the big banks were screwing the little banks, and the little banks were screwing the ‘little people’. Finally the regulators are holding them accountable and that’s the gist of the Friday announcement.” He then called me back to add: “Before the financial crisis they had incentive to ‘jack up’ rates, and during the financial crisis they needed to hide what they were paying…they needed to manipulate a lower Libor rate – and in turn, manipulating all of us (or so it is alleged). The bottom-line is that the banks undoubtedly owe everyone in Canada and the U.S. a few grand each.”
Luc just called and we were discussing angles so I asked him if he could try and translate what $800 trillion of loans and securities must look like to us ‘little people’. He said something about derivatives and agreed to do it.
Speaking of series, Jon Hykawy has just joined our quarterback line-up for an all original feature to run on Friday’s. While his take on the uranium market was not the same as mine, I would like to use this moment to reinforce our interest in chasing down the brightest minds to write, interview and record their positions on the various market sectors we cover.
Chris Ecclestone has become one of my favorites as his pieces are somewhat of a Wikipedia meets WSJ on each of the topics he covers. Last week we had a ‘you gotta love lithium’ article that I genuinely enjoyed. Now this is where I discuss Jack Lifton’s video commentary on Lynas and Molycorp that has received a lot of attention — and I stand behind his freedom of speech, and would like to acknowledge that many regard him as a well-established expert and speaker in our industry…
As a Publisher, I cannot get into what I agree with and disagree with every time someone expresses an opinion. What I can do is agree with Zuckerberg this week and say that I do agree that the online universe is riddled with challenges as we have everyone from the US-NSA to Facebook itself collecting all kinds of data on us that if we understood better, none of us would email. So I want to use Jack to say that I absolutely respect the fact that he is willing to go on record with his position.
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You want my opinion? Alright…the fact is for all of you that have me ‘at one with Jack’ – let me clarify that I do not always agree. This said he is more pleasant to disagree with than most. I have already told Jack that I see Molycorp* making it because I tend to be more surprised when the money players fall. I assume that with as much money and talent invested in MCP, someone knows how to throw a touchdown? Personally, I was impressed with Mark Kristoff, the CEO for Traxys Group and Board member, and my female intuition says that there is no way that board members like Mark or Constantine Karayannopoulos will not do whatever it takes to make this work. And for anyone else still moaning, Molycorp closed up +3.95% on Friday so one man’s opinion should not be seen as an end all to one’s reality for those that commented to this effect.
For the record, I do not agree with Jon Kaiser’s ‘Super Seven’ nor do I agree with Luisa Moreno’s picks, and I publish their picks and get along with them. Frankly, I think it’s high time we get another Dudley Kingsnorth interview happening…as our audience forgets how strong his opinions are.
That reminds me of sitting across from Eric Noyrez from LYNAS in my board room in December and let me add, I was impressed because he had the courage to come to our office and update his shareholders. I really happen to respect Eric, he’s smart and I deemed him to be a superior leader – he certainly didn’t let me see him sweat. And if you recall, we did a nice piece on Lynas or at least a thoughtful one when the rest of the media was less positive just this week titled: Lynas suffers more losses and needs to secure liquidity . Again, we are on the side of rare earths and want both Lynas and Molycorp to succeed. And if you hear Jack’s ‘big picture’ in his full commentary, he warns investors not to think the market for rare earths are asleep as “…it is very much alive”. I would argue that he has positioned himself as an ardent supporter of the sector too.
Now for the week ending March 14th the REE Leaders Index was down -5.73%, closing at 299.83. The Rare Earths & Technology Metals InvestorIntel members were barely down -1.08%. Thanks in part to Tasman Metals Ltd. NYSE MKT: TAS up +26.77% and TSXV: TSM +24.65% with no news, but Alessandro Bruno did a nice update on the 10th with Tasman Metals is the key to Europe achieving a rare-earth supply chain. Peak Resources Ltd. ASX: PEK up +12.50% (again) and Star Minerals Group Ltd. CSE: SUV rose another +9.09% for the week ending on the 14th.
The Graphite & Graphene InvestorIntel members were up +5.53% thanks in part to a splendid response from shareholders to the new potential Graphite Zones Identified at Balama North Project on Friday announced by Triton Minerals Limited – ASX: TON +42.86%.
Zenyatta Ventures Ltd. TSXV: ZEN up +8.03% and OTCQX: ZENYF up +7.21% on no news, but the interview I posted with Dr. Conly confirming Zenyatta’s graphite deposit is ‘special and rare’ had 600+ views in less than 24 hours — everyone can always use more ‘ZEN’*…
Speaking of an excellent interview, Frontier Rare Earths’ (TSX: FRO) James Kenny had a great response to his position on the many major rare earth debates such as the market difference between light and heavy rare earths (LREE vs. HREE), the US Energy department’s ‘critical elements list’, Chinese rare earths overcapacity and potential massive rare earth resources in North Korea and elsewhere that might reduce overall prices – that received a good response.
Finally, in spite of our excellent coverage of IC Potash Corp.’s filing of their Filing of Feasibility Study for the Ochoa Sulphate of Potash Project and our translation of their news out at the beginning of the week in a feature titled — IC Potash’s SOP (sulphate of potash) to be the world’s cheapest to produce…the Agribusiness, Potash & Phosphate members were down -6.62%. I have to believe that hard work and good news pays off, so perhaps this was some kind of stock deviation that will get corrected next week?
Intriguingly Gold, Base & Precious Metals flat-lined, but after we get the results of the Crimean referendum vote – and if it goes the way the exit polls suggest…if Russia secures the mandate to assist Crimean secession from the Ukraine…this is the kind of geopolitical action depending on how the global capital markets translate it — affects gold prices.
*Disclaimer: I am not a licensed investment advisor and I am not making any buy or sell recommendations.
An accomplished entrepreneur and corporate finance professional, Tracy Weslosky is the CEO for InvestorIntel Corp. and the VP of Business Development for Bellotti Capital Partners ... <Read more about Tracy Weslosky>