valuations "being thrown out the window"Junior resource valuations "being thrown out the window"
Valuationsin the junior resource space are being thrown out the window as themarkets crumble to a degree perhaps not seen ever before, says JohnLee, portfolio manager with Mau Capital Management LLC.
"Whatwe are witnessing is unraveling systemic risk, debt implosion in itsfull view except the scale is grandeur than 1930," he says.
Hesaid the main difference between today and 1930 is that the U.S. dollaris not anchored, adding that U.S. dollars will be pumped in tostabilize the system. "Maybe not through the [U.S. bailout] bill butthey will be through other means." he says
Mr. Lee adds thatthe liquidity crunch is sparing very few sectors right now, includinghis specialty, the junior resource sector. He says junionr resourceshares are now trading back to levels of $300 gold and $40 oil.
"Witha number of junior stocks I know trading below cash value, in themedium to long term those stocks represent great investment. However, Idon't know if today is the climatic bottom," he adds.
David Pett