RE: 50k bid, no sellers?Black Marlin,
I'm still in LRR largely owing to the Kinross deal. If this pans out, LRR should be in for a huge boost - the total cash from that deal alone is approaching $5.00 per share, all in. The key word here is "if". The money isn't in the bank yet. Some liked the Kinross deal, and some did not. I thought it was the best LRR could do with Campamento, and around a million ounces - you can only play with what you bring to the table. Put another way, show me another minor exploration company with a million ounces with a similar deal with a major? That this deal even exists is a tribute to the LRR management. Note - the Brazilian properties could also produce some surprises, but they are not the primary reason I'm still an investor.
LRM has potential, but after chatting with them at the PDAC, I left thinking that they need more tonnage in Cobra Grande in order to interest a major. The last news release confirmed that they did actually expand the find, and therefore the tonnage, so I bought a bit more - their pending 43-101 could interest someone if they have more than, say, 75 million tonnes - but I''m not an expert in this. The Moly at KM 61 also has great potential, and may actually prove to be more exciting to the market in the long run. In terms of raw financial up side, I think LRM is a better play than LRR over the next year.
Of the two companies, I must say that I have far less than I have had in the past. My major holding is now Gold I-Units, followed by Yamana. My take on this market is that many people got killed holding things like banks and trusts over the last 8 months, and they are selling the cheap and risky stuff like LRR and LRM - even at a loss - both to rebuild their holdings in other less risky assets, and because their losses on the blue chip-like stocks has made them far more risk adverse. Talk of a recession in the USA doesn't help. In short, I think that the price of commodities could double, then double again, and I'm not sure that will move the market for juniors in an atmosphere of fear.
Related to this, there is much talk about how LRR and LRM should be higher. In fact, I have small holdings in many little stocks - AQA, PAT, POS - that should also be higher. They aren't higher because this isn't two years ago. I have no idea how long juniors will be this low, but if it is a long time - say another year to 18 months - then raising new cash will become a major issue for many juniors. The other reason I like LRR and LRM is that they made sure to cash-up while the getting was good, and are in good cash positions to weather the storm we appear to be in - again, another tribute to the management. If they had less than a year's worth of cash right now, I would look for a chance to dump them both. On the other hand, I have recently started selling a little Gold I-Units and buying juniors again as I can't see how they can drop much more - and the whole plan is to buy low and sell high (I don't short...) When they will rise again is, as I noted, anybody's guess.
I don't know if this was useful, but I would ask that you ensure to do your own in-depth research - call the company and ask questions! All of the above is only my take, and should not be relied upon for anything but purpose of mild entertainment.
Cheers,
Issimo2
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