Gold has traded between $1,144 and $1,163 so far today…as of 8:30 am Pacific, bullion is flat at $1,155…Silver has retreated 9 cents to $14.76…Copper is off 3 pennies at $2.10…Crude Oil is unchanged at $31.74 while the U.S. Dollar Index has recovered half a point to 97.08…
An investor exodus from low quality U.S. corporate bonds should be a supportive factor for Gold prices, according to analysts at HSBC…yields on those bonds are now at their highest levels since 2009, at the depth of the financial crisis…
“In that same year,” HSBC commented, “Gold climbed from $800 an ounce at the beginning of January to $1,225 an ounce by early December, a rally of more than $400 an ounce. The current surge in yields and the rally in Gold prices are unlikely to be a coincidence.”
Producer Hedging Remains Limited
The global hedge book for Gold producers expanded modestly by a net 500,000 ounces, or 16 tonnes, during the 3rd quarter of 2015, largely driven by companies with operations in Australia as they apparently took advantage of a higher Gold price in that country’s currency, according to a report released yesterday by the GFMS team at Thomson Reuters and Societe Generale…the global hedge book stood at 6.2 million ounces, or 193 tonnes, as of the end of September…
U.S. Jobs Number Disappoints
The Labor Department reported this morning that the U.S. economy created just 151,000 jobs in January, the latest sign that growth is slowing…behind the headline number, about 20% less than the consensus estimate, there were nonetheless some positive components…average hourly earnings, average hours worked and labor force participation all rose last month, and those are important metrics for the Fed…the unemployment rate ticked down slightly to 4.9% while average weekly earnings increased 12 cents per hour or 0.5% on a monthly basis…
This morning’s report comes after the Fed’s first interest rate hike in 9 years in mid-December and as Wall Street speculation intensifies over what the central bank might do over the coming months…Fed officials have indicated a desire to hike rates as many as four times in 2016, though market expectations are for fewer or even no moves…amid volatile financial markets and clear signs of contraction in manufacturing and corporate profits, a slowdown in job creation would complicate matters for the Fed especially if it were accompanied by very limited wage growth…it’s also not inconceivable the Fed may have to return to QE later this year…
This week’s sharp move to the downside in the U.S. dollar is a significant development and suggests the central bank will not be tightening in the way it envisioned late last year…despite so many tools at its disposal, the Fed’s read of the U.S. economy and global conditions at the time it decided to go into a rate hike mode was off…they simply waited too long to pull the trigger…
Crude Oil Update
Oil tycoon T. Boone Pickens, who made and lost fortunes targeting some of the largest U.S. explorers over the past 40 years, has cashed out as the worst Crude market downturn in decades drags on…Pickens, who had forecast a big rebound in Oil prices by the end of 2015, has sold all of his Oil holdings and is waiting for the best moment to get back in, he said yesterday in an interview on Bloomberg Go…Pickens won’t start investing again until Crude inventories start to fall…in the U.S., commercial stockpiles have risen in 16 of the past 19 weeks and now stand at more than 500 million barrels for the first time since 1930 at the height of the East Texas Oil boom. “I will not re-enter, I’m sure, until we start to draw on inventories,” Pickens said. “That’s a key point.”
U.S. Crude inventories are at their highest level since the East Texas boom in 1930 as seen in this historical photo.
Canada’s largest integrated energy company posted a surprise $2 billion loss in the 4th quarter and said it will need to cut further into its spending plans to ride out the prolonged slump in Oil prices. “It’s not a crash diet, it’s a change in lifestyle,” Suncor Energy (SU, TSX) President and CEO Steve Williams on an earnings call yesterday as the company further reduced the capital budget it first announced in November by $700 million for the year…
Standard & Poor’s Ratings Services has the ratings of 10 U.S. Oil and gas exploration and production companies, citing the sharp drop in Crude Oil prices…Chevron Corp. (CVX, NYSE), the second-largest U.S. energy company by revenue, was among the companies that had its credit rating cut…just a week ago, Chevron said it would lay off workers and slash more than $9 billion in capital spending this year after reporting it had swung to a 4th quarter loss..
In today’s Morning Musings…
1. Obama’s plan to tax Oil companies to pursue “climate change” agenda – will Trudeau follow suit?
2. Fresh chart for TSX Gold Index after this week’s big move…
3. Why a reversal in the U.S. Dollar Index is so important for the Venture…
4. Updates on WRR, PGM and RRS…
Plus more…to view the rest of today’s Morning Musings, login with your username and password, or click here to gain full access to this and other exclusive BMR content and features…
Jon, Look at LSG, Take over rumor by THO, step in yesterday at 1.36!
Comment by Sylvain — February 5, 2016 @ 9:34 am
Yes, Sylvain, we’ve been mentioning LSG the last week or so in particular given its fundamental strengths and what appeared to be a pending breakout according to John’s charts – indeed, LSG has broken out…one of several really strong Canadian producers with bullish charts…RIC, CRJ and DGC are also looking great…
Comment by Jon - BMR — February 5, 2016 @ 9:42 am
No comments on KSK Jon? The stock price just doesn’t belong where it is if you look at the fundamentals.
Comment by Dan1 — February 5, 2016 @ 9:49 am
You’re right about the fundamentals on that one, Dan. I’m certain it will enjoy a nice ride at some point this year – the wait will be worthwhile. Impossible to predict exact timing – could be very soon or several months out.
Comment by Jon - BMR — February 5, 2016 @ 9:56 am
Lsg halted Jon,
Comment by Sylvain — February 5, 2016 @ 10:32 am
LSG halted at 10:05 PT. Take out I’m assuming? As gold moves higher I would think more Canadian junior high grade miners with good balance sheets get taken out. It almost sucks as it has been such a long wait to buy back into gold stocks and then the good ones might disappear before they can make a good run.
Comment by DBReese — February 5, 2016 @ 10:48 am
Well, I think this is it for the broad market. S&P next leg down on its way. SPXU (triple short S&P) now above 20 SMA, 50 SMA crossing the 200 SMA, 200 SMA flattened and reversing up…
Comment by rgiroux — February 5, 2016 @ 11:46 am
GGI – This would have been a great time to release some great news, but its only February lots of time to release it.
Comment by 02charoc — February 5, 2016 @ 12:33 pm
LSG nice move , all the more importance for gold content in GGI and DBV .
Comment by Lester — February 5, 2016 @ 12:42 pm
Gold, nice!!!
Comment by Laddy — February 5, 2016 @ 12:46 pm
GGI – 46,000 shares sold just at end of day at 0.105.
Comment by 02charoc — February 5, 2016 @ 1:01 pm
GGI – update on website – positioned to seize the POWER of High-Grade opps in BC and Mexico. things are getting closer to ?
Comment by david — February 5, 2016 @ 1:03 pm
GGI. Fact sheet now says assays imminent. Also further substantial high grade discovery potential at Rodadero. They must like what the drill is bringing up at Rodadero.
Comment by Dan1 — February 5, 2016 @ 1:14 pm
ggi – selloff – was a knockdown by CIBC of 4000 shrs to .105, a switch , otherwise it was a stellar day for no news. The fact sheet coming out today, MAY suggest news next week, since it was suggested that they were going to do this prior to news. we’ll see. the exchange had to vet this printed piece I suspect, so I wonder what their take was on the POWER comment
Comment by david — February 5, 2016 @ 1:22 pm
My bet. They have hit big again at Rodadero.
Comment by Dan1 — February 5, 2016 @ 1:27 pm
02charoc. Take another look at the prints on ggi. Only 4k was sold at 10.5. Trade prior was a 42k share buy at 12.
Comment by Treb — February 5, 2016 @ 1:42 pm
Thanks Treb. Missed that
Comment by 02charoc — February 5, 2016 @ 1:47 pm
I hope imminent means next week….but with GGI I’m not so sure
Comment by weatheritout — February 5, 2016 @ 2:30 pm
4000 shares at .105 cost someone $420 plus trading fee. It appears someone it painting the tape to show a lower close for the day , other trades at the end of the day are even smaller . One must ask why would anyone buy or sell $200 worth of shares often in the dying seconds of the day.
Comment by Lester — February 5, 2016 @ 2:47 pm
New Sheslay district deposit, crews on the ground at Rodadero. Next week should be interesting.
Comment by Jon - BMR — February 5, 2016 @ 2:52 pm
Once again the Venture exchange has closed above the 50 DMA at 508 , next it must get substantially above the last high area around 530 before losing strength.
Comment by Lester — February 5, 2016 @ 3:02 pm
garibaldiresources.com/i/pdf/GGI_FactSheet.pdf
Drill results imminent, though in GGI’s case “soon” “next week” and “imminent” doesn’t mean much.
Comment by ConcernedCitizen — February 5, 2016 @ 3:08 pm
” black unit ” drill results imminent. = but please wait . It’s like watching paint dry .
Comment by Lester — February 5, 2016 @ 3:46 pm
I actually believe our patience will be rewarded next week.
Comment by weatheritout — February 5, 2016 @ 3:51 pm
I said the other night GGI news next week.
Comment by dave — February 5, 2016 @ 4:12 pm
I said that the other night also Dave….but to be fair I’ve been saying it every week since November
Comment by weatheritout — February 5, 2016 @ 4:56 pm
Interesting new video on the BLO web site. Good volume today.
Comment by Jon - BMR — February 5, 2016 @ 5:14 pm
Message for the BMR crew,
I was just thinking how convenient it would be if BMR had a search function whereby subscribers could enter a ticker symbol from BMR stock coverage/commentaries and access all the past coverage of said stock. I often find myself wanting to do research from information generated at BMR but would not be able to access it without having to go through months of previous coverage. Even a list with the ticker symbol followed by the specific dates the stock was commented/covered would be helpful. We could then go to a particular date/dates and scroll down until we find the stock in question.
John
Comment by John — February 5, 2016 @ 6:49 pm
Excellent idea John. I’m all for that feature.
Comment by Treb — February 5, 2016 @ 7:31 pm
Sooo. A couple words are different on the fact sheet? Is that the only change on ggi’s website? I looked but can’t recall what was there before.
Comment by Treb — February 6, 2016 @ 7:08 am
I agree John, would be a great feature. You have to like the price action in gold, bodes well for the junior market.
Congrats to the WRR shareholders. I had originally purchased at .04, got impatient, sold at .025 and made a negative comment regarding the company on this board. Looks like I was wrong on that one however happy to see other shareholders on this board make money on it. Their drill results looked really good. Now, hopefully, finally we see the same thing from GGI.
Comment by Danny — February 6, 2016 @ 9:35 am
Treb, GGI changed “drill results soon” to “drill results imminent”.
What’s more important is that the jan 21st fact sheet and the feb 5th fact sheet are consistently telling us that the black unit is “significant”. That part hasn’t changed.
It’s a certainty that they know what they have, and they’re still insisting it is
significant.
Comment by ConcernedCitizen — February 6, 2016 @ 10:29 am
So almost with certainty we will have results this coming week….so for all GGI investors…what do you think the reason for additional assays?…and guesses for what’s in that mafic unit????
Comment by weatheritout — February 6, 2016 @ 10:33 am
BLO… u too can participate in the PP… am thinking about it.. they mention in the video they released that the BETA prototype is in development.. means the alpha is done as such.. and that the technology has been refined to the point of acceptance by the system of law.. Jon – your comments???
Comment by Jeremy — February 6, 2016 @ 11:44 am
Thank you CC. I don’t see how that equates to drill results being released this coming week though weatheritout. That’s just my opinion but I hope you are correct.
Comment by Treb — February 6, 2016 @ 11:45 am
The black unit could contain anything from Gold, silver, lead, zinc, moly, Cobalt, REE’s, and I dare to say nickel. Let’s hope what ever it is it be high grade. The size is certainly there 1.2km mineralized structure and only 5 holes drilled yet.
Comment by Dan1 — February 6, 2016 @ 11:50 am
Jeremy, they’ve obviously been making some excellent progress and have gone well beyond the original prototype into the next stage…I would say the technology has been refined to the point where there is a strong comfort level that it will find acceptance by the law – successful testing would confirm…could be a great year for BLO, things are definitely ramping up again…
Comment by Jon - BMR — February 6, 2016 @ 11:54 am
From Brittanica: Fire assay is considered the most reliable method for accurately determining the content of gold, silver, and platinum-group metals (except osmium and ruthenium) in ores or concentrates.
Snippets from Bureau Veritas’ website regarding fire assays:
Fire Assay Testing
Full capabilities for gold and precious metals analysis are available at many of Bureau Veritas’ locations around the world. Fire assay is unrivalled as the preferred method for economical determination of total gold concentration in geological, mine production and mineral processing samples. The fire assay process involves fusion of the sample with a fluxing material, followed by cupellation to produce a prill containing the gold. Depending on your needs, analysis may be performed by ICP-MS for low level detection, ICP-ES or AAS for grade samples or gravimetric methods at higher concentrations or for accounting purposes.
Gold analysis is also available at many locations using a number of other geochemical and metallurgical techniques such as screen fire assay, aqua regia, cyanide and other partial leaches. Fire assay using a palladium collector can also be used for the analysis of silver and rhodium.
Bureau Veritas Minerals specialises in platinum group elements (PGEs) using nickel sulphide techniques, and is an established global leader in this technology.
————————————–
Assaying content in precious metals
FIRE ASSAY SOLUTIONS
Fire assay is a vital aspect of determining the precious metal content of samples. There are a number of stages in the process from original sample to isolated precious materials which can be tested using other techniques. Samples are placed in crucibles and heated to more that 1800 Degrees Celsius with other compounds including lead oxide. The sample separate into metals mixed with the lead and covered molten glass (slag), which contains base materials and other contaminants. This is separated from the lead ‘button’ by cupellation. The lead ‘button’ is placed on a cupel and heated to more than 1700 Degrees Celcius.
The cupel absorbs the lead leaving a small amount of precious metal which can then analysed in a variety of ways – through chemical means, through gravimetric testing or by spectrometer. Inspectorate provides fire assays through its centre of operations at Witham as well as Reno; Nevada and Shanghai; China sites.
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GOLD TESTING LABORATORY NETWORK
Inspectorate has 7 laboratories globally (the UK, United States, Australia, China, Chile, Peru, and South Africa) with fire assay facilities to provide the most accurate measurements of gold bearing materials including non-ferrous concentrates, dore bullion and alloys, based on highly efficient gravimetry techniques complemented, when appropriate, by atomic absorption spectrometry (FAAS) and inductively coupled plasma (ICP) methodology
Inspectorate’s preferred method of gold analysis is initially conducted through fire assay, a method that has existed for many centuries but is now undertaken in a streamlined process. It is essential to carry out the process in a highly disciplined way to ensure accuracy. Inspectorate’s laboratory technicians are greatly experienced in the techniques and processes and their analysis is regarded as outstanding in the industry…….Although fire assay is a well-established way of isolating the precious metal material, it is essential that it is carried out with meticulous care.
———————————
Don’t know if this helps any but it’s educational at least.
Comment by Treb — February 6, 2016 @ 12:15 pm
BMR – in the matter of full disclosure have you sold any shares in GGI from October 2015 to now? Were you buying when you were alerting us to buy?
I dont see zinc, lead, iron ore etc doing anything good for GGI. What do I know.
Comment by 02charoc — February 6, 2016 @ 7:41 pm
02charoc, I agree…I don’t see zinc, lead or iron ore doing much for GGI. And I don’t believe that’s what they have. I’ve only added to my position since October, between a high of 13 cents and a low of 10 cents.
Comment by Jon - BMR — February 6, 2016 @ 8:45 pm
Outside of Gold and silver, Veritas uses fire assays for platinum group metals. It isn’t reliable for osmium and ruthenium if I understand this correctly.
The six platinum-group metals are ruthenium, rhodium, palladium, osmium, iridium, and platinum.
Jon you’ve said you think that the black unit is something different, not gold or silver. Are we able to deduce then from Bureau Veritas’ own information that if fire assays are being used then we are looking at rhodium, palladium, iridium or platinum? Or…is my newbie deduction here misguided and naive? Anyone?
Comment by Treb — February 7, 2016 @ 3:59 am
Imo,it will be coppper/gold and the results will match DBV,Red Chris,PGX etc in the area.It’s all the same geology.The reason for a re-assay has to be the common sense one…the results from the fire assay didn’t match what they got from the XRF.
Matching the same results as everyone else is the target for GGI.They would consider that great.If they would have thought they were onto something unique in the world,they wouldn’t have just stopped the drill.They would have wanted to really catch the investors’ attention with a twin hole.They didn’t do that.
It just seems people’s imaginations are beginning to get in the way of rational thinking.
The stock should move with matching results from other area plays.The area geology is what it is.
Looking at core photos from DBV’s site,from #21-32 you can pretty well see the same photos as what GGI has for their ‘black unit’.
That’s my call anyway.Matching results with the other players in the area.Which is pretty good,considering that was their target.
Comment by robinandthe7hoods — February 7, 2016 @ 10:15 am
Copper/gold says 7hoods and something entirely different says bmr. I was hoping I was on to something with the possibility of platinum.
Comment by Treb — February 7, 2016 @ 2:02 pm