Takeovers generally bring cash and courage into a market, and that there are still sellers in the face of all this good news is perversely, to me, very encouraging. We just had another $570 million acquisition announced today.
I don't know if you saw Ivanhoe Mines’ financing, but when the best promoter in the world figures out that in order to get the project going he needs raise the money and goes ahead and offers a full warrant, that tells me that we are coming into a very good financing season.
It's funny that the B-grade promoters in Vancouver are arguing with you, trying to get a half a warrant, while the best promoter in the world, Robert Friedland, decides that he has to advance his project and so, yes, he gives a full warrant. I promise you that the B-grade promoters will come to their senses because they are not better promoters than Friedland. Also, the platinum and palladium markets have been performing relatively well. We have lost 1 million ounces of platinum production, so that will give us a deficit of 1.6 million ounces for the year.
Of course we are attracted to other markets that investors hate right now. Uranium is selling at about $28 a pound when it takes about $70 to make, including sustaining capital. So that can't last forever. Also, the coal markets are clearly in liquidation mode, but we are certainly attracted at this point to the coal sector. We are also attracted to the ag-mineral space, although it's probably early there.
I should explain to KWN readers around the world that I have made a lot of money over the last three decades investing in sectors that are in liquidation. This occurs when the selling price of the commodity is less than the cost of producing it.
- Source, Rick Rule via King World News