Jeff Desjardins and James Fraser Look at Junior Miners in a Surprising Way

ticker120It’s never too late to find a new way to evaluate mining companies, and Jeff Desjardins and James Fraser of have developed one based on over 20 different criteria. Add in some near-term catalysts and the wheat separates from the chaff. In this interview with The Mining Report, Desjardins and Fraser share the names of companies with some’s highest junior mining scores.

Jeff Desjardins founded, a universal, independent and comprehensive stock scoring system that gives investors access to investment research on mining stocks. Tickerscores has coverage of over 450 precious metals companies on the TSX and TSX.V and compares them head-to-head to make due diligence easier for investors. Each quarter, Tickerscores also puts out an in-depth Top 10 report of the highest scoring stocks in the system and other analyst picks.

James Fraser, mining analyst at, is passionate about the mining sector and mining stocks. His passion led to co-authoring the book “Mining Stocks Investor Guide: a guide to investing in mining companies.” He has a finance background and has completed his Canadian Securities Course (CSC) and Conduct and Practices Handbook (CPH). When Fraser is not “digging” up the latest mining stock, he can be found enjoying a wide variety of sports or travelling the world.

Interview by Brian Sylvester of The Mining Report

The Mining Report: A recent article on, “The Great Divide: Inequality in Gold Juniors Means Opportunity,” said: “It’s clear we’ve reached a new level of separation between the wheat and the chaff.” What does that mean for investors?

Jeff Desjardins: As the bear market has progressed, many companies have struggled to raise the necessary funds to advance their projects. Even for those that have been more fortunate, it has often come in the form of dilutive financings.

Cayden Resources Inc. was just taken out by Agnico Eagle Mines for $205M at a premium of 42.5%.

On the other hand, quality management teams have found ways to continue to move projects forward. We’re starting to see a big separation in metrics such as cash, general and administrative expenses (G&A), news flow and, ultimately, the creation of shareholder value. For example, we cover 22 exploration companies working in Ontario and 82% of those had less than $400,000 in cash in Q1/14, up from 65% in Q3/13. Our top three exploration companies in Ontario hold an average cash position of $2.2 million ($2.2M) each. The other 19 average only a mere $150,000 per company. Furthermore, the G&A expense ratio for the bottom 19 companies is a hefty 76%, which means that $0.76 of every dollar is not going into the ground.

We are looking at a great divide between the rich and the poor. The funny thing is that even though the rich companies have great management teams and cash to continue to develop their projects — key things that you want in a junior name — they are still trading at great valuations.

TMR: In which mining sub sector — producer, developer, explorer — is an investor likely to get the most bang for the buck?

JD: All those types of companies have their advantages. It depends on an investor’s portfolio, strategy and risk tolerance. Right now, we’re focusing on developers. We published a report in early September that lists some promising companies in this stage. We believe developers with high-quality assets will be subject to merger and acquisition (M&A) activity once they are sufficiently derisked because larger companies want to buy proven resources at rock-bottom prices.

Clifton Star Resources Inc.ranks in the top third of our Quebec development companies.

Investors should look for developers with a resource of at least 3 million ounces (3 Moz) with high grade and in a safe jurisdiction. A takeover offer is rarely made before a company publishes a preliminary economic assessment (PEA) so investors should look for a PEA or feasibility study with a high net present value (NPV), low capital costs (sub-$700M) and a high internal rate of return (IRR).

TMR: What jurisdictions should investors be taking a closer look at right now? Continue reading

Brien Lundin Says Don’t Miss This Opportunity to Buy Gold Stocks


Brien Lundin, founder of Jefferson Financial, producer of the New Orleans Investment Conference and Gold Newsletter, believes at least a small amount of the massive liquidity produced by loose monetary policy in Western economies will find its way into mining equities following a summer pullback in equity prices — but don’t wait long. Lundin expects the “buying opportunity” to last for two, maybe three weeks before seasonal gold demand pushes prices higher. In this exclusive interview with The Gold Report, Lundin discusses a select group of gold and precious metals equities that he expects to perform well as near-term news reaches the market.

With a career spanning three decades in the investment markets, Brien Lundin serves as president and CEO of Jefferson Financial, a highly regarded publisher of market analyses and producer of investment-oriented events. Under the Jefferson Financial umbrella, Lundin publishes and edits Gold Newsletter, a cornerstone of precious metals advisories since 1971. He also hosts the New Orleans Investment Conference, the oldest and most respected investment event of its kind.

Interview by Brian Sylvester of The Gold Report

The Gold Report: On July 30, you sent out a Gold Newsletter alert that forecast a pullback in the midsummer bull market. The next day the Dow dropped 317 points, while the NASDAQ fell about 93 points. Since then the Dow has climbed back above 17,000, the NASDAQ above 4,600. Should investors dismiss that drop or do you believe it was akin to a tremor preceding an earthquake?

Brien Lundin: That particular call made me look like a genius at the time, but right after that drop the stock market took off and reached new highs. The stock sell-off in late July was a sign that investors were nervous because we haven’t had a meaningful correction during this bull market. However, there are potential pitfalls ahead for the economy — we still have to navigate the U.S. Federal Reserve’s ending of quantitative easing and its first interest rate hikes. There’s nothing directly ahead that indicates a major correction will occur, yet these things happen when you’re least expecting them.

Almaden Minerals Ltd.’s Ixtaca is already a multimillion-ounce deposit that justifies development.

TGR: You’ve been warning investors inGold Newsletter about the erosion of the foundation of the U.S. equity market. Please give our readers a few points to underpin your thesis.

BL: When I put forth that thesis, Q1/14 gross domestic product (GDP) had missed consensus estimates by 3.3%. The consensus going into that report was for 1.2% growth but it turned out to be just 0.1% — only to be subsequently revised further down to -2.1%. The miss for the consensus estimate was remarkable.

I posited that these reports had possibly captured some underlying weakness in the economy. I expected a rebound in Q2/14 because a lot of economic activity was put off due to the unusually cold winter weather. But Q2/14 GDP was over 4%. I certainly wasn’t expecting anything like that, and neither was anyone else.

So, the idea of a major stock market decline stemming from a weakening U.S. economy has become more remote, at least for the time being.

TGR: What are you seeing now?

We have followed Asanko Gold Inc. from its inception and still recommend it.

BL: The massive amount of money created in developed economies since the 2008 credit crisis really has not resulted in significant retail price inflation. If anything, there has been disinflation in major economies, such as in Europe where the European Central Bank is now turning to quantitative easing. The real result of quantitative easing in the U.S. and loose money policy throughout the Western economies is a virtual flood of liquidity looking for places to land. It’s why we have U.S. Treasuries being bid down to their lowest rates ever, while the U.S. stock market is hitting record highs. Those two asset classes should be at opposite sides of the seesaw, but there’s so much money looking for a home that both are soaring simultaneously.

TGR: The Market Vectors Junior Gold Miners ETF (GDXJ:NYSEArca) has been trading lower since mid-July. In fact, the Dow Jones Industrial Average has outperformed that ETF over the last month or so. Is that a buying opportunity? Continue reading

Gold’s Touchdown Pass: Will Janet Yellen Fumble On Rates?

Frank Holmes talks gold, FOMC, and the Far East on this edition of “Gold Game Film.” Holmes tells Daniela Cambone of Kitco News that all eyes will be on the Federal Open Market Committee meeting ending on Wednesday. “How will [Janet Yellen] describe the exit by the fed from the bond market and will they be looking at an extended period of time before they change interest rates,” he says will be the main focus of the meeting.

Moving eastward, Holmes also shares his thoughts on the Scottish referendum, continued sanctions on Russia and the upcoming Shanghai Gold Exchange (SGE) and how all of these may eventually affect the gold market. In particular, the SGE, he says, will change the flow of gold and may provide a great opportunity for the metal. “Remember the strategy for China and Shanghai, because it created a tax-free zone, is to make this the dominant place in the world for gold trading.

That’s the long-term vision,” he says. “And based on the size of their GDP and growth rate, it’s only a matter of time.” Tune in now to find out what quarterback Holmes thinks may be gold’s touchdown pass this week and more!

FATCA and FBAR – What’s the Big Deal

Dudley Pierce Baker
Ex-Pat since 1999

I don’t claim to be a tax expert but I do have some knowledge and background on this subject matter that may be of interest to all readers.

As we get started let’s not forget that the tax system in the United States operates on what is referred to officially as ‘voluntary compliance’, reality is it actually operates on ‘fear’.

U.S. citizens and U.S. persons holding assets outside of the United States have two different required filings depending on the amount of dollars in question.

FBAR is the Report for Foreign Bank and Financial Accounts and essentially comes into play if you have $10,000 or more outside of the United States.

United States persons are required to file an FBAR if:

1. The United States person had a financial interest in or signature authority over at least one financial account located outside of the United States; and

2. The aggregate value of all foreign financial accounts exceeded $10,000 at any time during the calendar year reported.

United States person includes U.S. citizens; U.S. residents; entities, including but not limited to, corporations, partnerships, or limited liability companies, created or organized in the United States or under the laws of the United States; and trusts or estates formed under the laws of the United States.

There are some exceptions to this FBAR reporting which can be found here.

Then we have FATCA which is the ultimate invasion of the whereabouts of your financial assets located any where in the world.

No one likes FATCA but (for now) it is the law of the land and not following the required reporting will only create many potential problems for those individuals and companies choosing to not comply.

FATCA, The Foreign Account Tax Compliance Act was presumably designed as a measure to crack down on money laundering and tax evaders who hide assets in offshore accounts. But the law is causing global scale headaches for banks and their clientele alike.

Many Americans residing overseas are reporting banking lockout. Many foreign financial institutions have simply chosen to eliminate their U.S. citizen and U.S. person client base in order to minimize their exposure to FATCA reporting requirements, withholding fees and potential penalties, and frankly who can blame them.

“FATCA was passed in 2010 as part of the HIRE act. Starting July 1, 2014 foreign financial institutions (FFI) will be required by the U.S. government, under FATCA, to report information regarding accounts of all U.S. citizens (living in the United States and abroad), U.S. “persons,” green card holders and individuals holding certain U.S. investments to the IRS all their clients who are “U.S. persons”. FFI that do not become compliant will be subject to a 30 percent withholding on their U.S. investments when they are cashed in, which will directly impact FFI clients with U.S. holdings.

FATCA also requires U.S. citizens who have foreign financial assets in excess of $50,000 (higher for bona fide residents overseas: $200,000 dollars for single filers and $400,000 dollars for joint filers – see the IRS website for more details) to report those assets every year on a new Form 8938 to be filed with the 1040 tax return….”

A few helpful links for U.S. Taxpayers:
Taxpayers Living Aboard
U.S. Citizens and Resident Aliens Abroad
U.S. Citizens and Resident Aliens Abroad – Filing Requirements
Report of Foreign Bank and Financial Accounts – FBAR

Who am I?

I have been an ex-pat since 1999 and enjoy a great life living outside the United States. Not only am I an ex-pat but I am also a retired IRS agent with over 29 years of service before retiring in 1996. You may have seen another financial service quoting an unnamed retired IRS agent with 29 years but that is not me and I have no knowledge if that person even exists.

For much of my career with the IRS I was an IRS agent – team coordinator and the lead agent on the largest corporations in the world. I have not performed any tax work for hire since my retirement and my interests lie with my various financial related websites.

Again, What’s the Big Deal?

Allow me to discuss briefly two terms that are relevant to our discussion:

Tax Avoidance and Tax Evasion

Tax avoidance simply is making use of the current tax laws to ones advantage while tax evasion is the intentional disregard for the laws, omission of income, overstating of expenses, in essence, outright fraud.

For most U.S. citizens with foreign accounts we would assume they are doing so to diversify their assets on a global basis and there is nothing wrong or immoral with these transactions as this would fall under the tax avoidance definition, in my opinion.

Of course, income earned or gains derived in foreign countries are reportable as income on their U.S. tax returns even if those individuals do not receive statements from those foreign financial organizations similar to the 1099s in the United States.

Some U.S. citizens living abroad may feel secure (for some reason) in not reporting gains or income earned in foreign accounts or from real estate transactions. These individuals may not realize that they are now entering the area of tax evasion and this is not where you really want to be. You don’t want to run a fowl of the system and be subjected to a criminal investigation, so those individuals should think twice as to the potential repercussions of their actions.

Getting back to basics, it all boils down to a reporting issue.

· The FBAR requires you to report accounts that have over $10,000 in foreign accounts with a June 30 filing date.

· FATCA also kicks in with Form 8938 to be filed with the 1040 tax return for those having foreign financial assets in excess of $50,000.

Unless you are prepared to renounce your U.S. citizenship , also see this recent article on or relocate to Puerto Rico, a territory of the United States, to take advantage of their generous tax filing status, I would suggest U.S. citizens just file the required forms. Yes, the IRS will now have all the details on your foreign accounts, but if you are reporting your income correctly and not attempting to commit tax evasion, what’s the big deal?

Another option (not advised)

Remember the movie, Raiders of the Lost Ark with Indiana Jones and the last scene in the large warehouse? Is it possible the IRS could even find the FBARs and FATCA filings or are they lost in a similar government warehouse.


However, not correctly reporting will create many sleepless nights for you with the fear of being discovered. The potential penalties should outweigh the minimal requirements of correctly reporting ones transactions as required by law.

Until the laws are changed (if ever) for those U.S. citizens with foreign assets abroad we must conclude with our opening title…

What’s The Big Deal?

Junior Gold Miners Forecasting Bottom In Precious Metals

By Jeb Handwerger
Mining Feeds

Jeb Handwerger

Jeb Handwerger

This past week I have had to cut back on my publishing due to my travels to the Precious Metals Summit where I had back to back meetings with some of the top fund managers, investors and over 30 of the highest quality junior miners. I was able to get updates in person of current and past holdings as well as potential new first class opportunities with huge catalysts ahead.

The Post Labor Day rally in precious metals I expected has turned into the Post Labor Day Selloff for precious metals and many mining stocks. Many investors came back from Labor Day and sold their precious metals in favor of the U.S. dollar. This could be the worst possible trade right now. This could be the shakeout before the breakout in the precious metals. Generally this is a seasonally strong time for gold and silver. We may bounce off new lows below $1200.

Despite gold testing new lows, the junior miners are still in an uptrend since December of 2013. Is the outperformance of the junior miners indicating that gold may bottom here around $1200?

Continue reading . . .

Gold Industry Needs ‘Cleansing’ of Weakest, Fidelity Says

By Liezel Hill
Bloomberg Businessweek

Joseph Wickwire

Joseph Wickwire

The gold industry, recovering from the worst slump in prices in 30 years, needs more mergers to help improve investor returns and eliminate unprofitable mines, Fidelity Investments said.

About a third of gold production is probably money-losing when the price of the metal is lower than $1,250 an ounce, said Joe Wickwire, who manages more than $1.8 billion of assets including the Fidelity Select Gold Portfolio. (FSAGX:US) With gold trading at about $1,230, it “might not be a bad thing” if the number of producers was reduced by a third.

“It’s part of the life cycle of industries that every so often you need to have a cleansing of that which is not working,” Wickwire said in a phone interview last week from Boston, where Fidelity is based.

Continue reading . . .

Amaya Gaming Warrant Analysis: Learning About Leverage

By Dudley Pierce Baker
Founder-Editor, Common Stock Warrants
Posted on Seeking Alpha

amayaGaming is a favorite activity of many as we immediately think of Las Vegas, bright lights, showgirls and glamour.

One company trading in this investment sector is Amaya Gaming (OTCPK:AMYGF), a Canadian company that has greatly expanded its brand and presence in the last several months. The company headquarters is located in Pointe-Claire, Quebec, Canada.

Amaya Gaming has exploded on the scene in a short few months with growth and visibility on the world stage with some strategic acquisitions, i.e., Poker Stars and Full-Tilt Poker as well as advancing their Cadillac Jack machines.

Information from the company’s website and discussion of 2nd quarter results reveals the following:

Continue reading . . .

CIBC’s Jeff Killeen: Cash and Catalysts Rule the Day

cibc160Jeff Killeen, mining analyst with CIBC World Markets, has spent much of 2014 on the road vetting junior mining projects. He says that the cash-and-catalyst mindset should remain prevalent for investors looking at explorer and developer equities, while improving operations has been the biggest motivator for producer share prices in 2014. In this interview with The Gold Report, Killeen offers his insight and hands-on perspective on several developers and producers with near-term catalysts.

Killeen has been with the CIBC Mining Research team since early 2011. He covers and provides technical assessment of junior and intermediate exploration and mining companies worldwide. Prior to joining CIBC, Killeen worked as an exploration and mine geologist in several major mining camps, including the Sudbury basin and the Kirkland Lake region. Killeen earned his Bachelor of Science degree from Carleton University.

Interview by Brian Sylvester of The Gold Report

The Gold Report: Two years ago CIBC World Markets recommended taking a short position on a selection of gold stocks. What’s CIBC’s view on gold stocks today?

Jeff Killeen: We had put out a basket of names recommending some short positions, but at that time gold was trading at about $1,600/ounce ($1,600/oz) and there was little support for the price at that level. That dynamic doesn’t seem to be at play in today’s environment. We are maintaining our current recommendation: Investors should be at market weight with respect to their gold equity allocations.

“The gold exploration stocks that are still on the radar for institutional investors are companies like Asanko Gold Inc.

Many mining stocks have performed well in 2014 and the move has largely been motivated by several factors. First, gold bullion itself has found a footing. The gold price has traded in a range of $1,250–1,350/oz, which is fairly narrow compared to how gold prices have moved in the past three to five years. Investors are becoming comfortable with the idea that gold will remain range bound for the coming 12 months or more, and concerns that gold could drop significantly over a short period seems to be waning with gold seeing support around $1,250/oz.

While some profit taking on strong first half share performance is certainly justifiable, I continue to recommend buying gold stocks with a focus on companies that are currently generating healthy margins and could enjoy higher trading multiples as they gravitate up toward longer-term averages. I also like gold stocks that have underperformed relative to their peers in 2014 that are projecting improving operations or have meaningful catalysts in the near term.

TGR: What do you expect the trading range for gold to be through the end of 2015?

JK: Our gold price estimate for 2015 is $1,300/oz. Next year is likely to look a lot like 2014 with typical seasonal moves and maintaining that price range of roughly $1,250–1,350/oz for the year.

TGR: Do you think the Market Vectors Junior Gold Miners ETF (GDXJ:NYSEArca) will be up another 30% through the first eight months of 2015? Continue reading

Australian miner refuses to pay bribes to Guyana officials

By Bert Wilkinson
Caribbean Life News

guyana160An Australian mining company preparing to open a large-scale mine in Guyana has unwittingly handed the opposition a key elections issue on a platter by publicly condemning demands by government officials for bribes and inducements to help it get things done in the mineral-rich country.

Thanks to the successful filing of a no confidence motion by the seven-seat Alliance for Change (AFC) last month, general elections could be held later this year or early next year depending on whether parliament reconvenes from its summer break and votes on the issue in early October or whether the governing Indo-led People’s Progressive Party (PPP) decides to call an early date or not.

This week, Perth, Australia-based Troy Resources said in a statement that it absolutely won’t pay any bribes to government officials and regulators to get things done in relation to a large gold mine it is preparing to open in the west of the country near Venezuela next year.

This is so because it is still subjected to Australian laws on graft, transparency, and corruption whether or not it is at home or outside of its Australian home base.

Continue reading . . .

Agnico Eagle Mines | Welcome To Jalisco, Mexico


By Dudley Pierce Baker
Founder/Editor, Common Stock Warrants

Normally the State of Jalisco in Mexico is synonymous with tequila, mariachis and beautiful women.

mex-flag-150x150Of course mining for gold and silver in the State of Jalisco actually dates back to 1545 but to my knowledge, Agnico Eagle is the first major mining company soon to be operating in Jalisco.

I proudly call Jalisco home as I have been living in the Chapala-Guadalajara area for over 15 years and being on the fringe of the mining business with my websites and newsletter and I am happy to see Agnico Eagle Mines, NYSE:AEM and TSX:AEM coming into our area with their proposed buyout of Cayden Resources, TSXV: CYD.


Shareholders of Cayden are on the short list of successful investors over the last 3 years in the resource sector but thanks to good management and good properties I must say congratulations to the team at Cayden for a job well done. Several analysts have covered Cayden and I recall Bob Moriarty of in particular telling everyone that CYD would be bought out, so congrats to Bob as well for a great call.


Of particular significance to me is the location of the Cayden properties and whether other resource companies operating in the immediate area may soon also be in play.

“….Cayden owns, has options to acquire or has staked, concessions constituting a 100% interest in the El Barqueňo Property, which covers approximately 41,000 hectares in the Guachinango gold district in Jalisco State, Mexico. El Barqueňo hosts a significant epithermal bonanza type gold vein and disseminated stock work system. Several gold bearing zones have been identified by drilling and trenching in an area approximately 13.5 km long by 4.7 km wide.

Cayden also owns a 100% interest in the Morelos Sur Property, which covers approximately 13,000 hectares in the Guerrero gold belt in Guerrero State, Mexico. Morelos Sur consists of three properties (La Magnetita, Tenantla and Las Calles), and exploration by Cayden has outlined a 25 km2 gold soil anomaly at La Magnetita, and Tenantla.

“This acquisition is consistent with our long-term strategy of acquiring promising, early stage gold projects where we can add value through focused exploration and mine building” said Sean Boyd, President and Chief Executive Officer of Agnico Eagle. “This strategy has served us well in Mexico, and we believe that the Cayden properties are a very good fit with our existing southern operations and skill sets”, added Mr. Boyd.

“We are pleased with the value that this transaction delivers to our shareholders and are excited at the prospect of Agnico applying its resources to the advancement of El Barqueño and the results that will surely follow. Our success could not have happened without the hard work of our entire team, and I’d like to thank them for all of their outstanding efforts.” said Ivan Bebek, President and Chief Executive Officer of Cayden Resources.

El Barqueňo Property Highlights

Located in the Guachinango gold district near existing infrastructure (highway, power, labour)

Early stage gold project with historical heap leach production (approximately 250,000 ounces produced in the 1980s)

Epithermal bonanza type gold veins and disseminated stockwork systems – veins and mineralized structures have been identified in an area 13.5 km long by 4.7 km wide. Seven significant zones anomalous in gold have been identified to date

Drilling by Cayden has focused on the Azteca, Angostura and Peña de Oro zones

Highlights from Cayden drilling at the Azteca zone include: 4.26 grams per tonne (g/t) gold and 0.06% copper over 20 metres; 2.34 g/t gold and 0.15% copper over 44 metres

Highlights from Cayden drilling at Peňa de Oro include: 4.46 (g/t) gold and 0.09% copper over 27 metres; 4.06 g/t gold and 0.39% copper over 45 metres

Preliminary metallurgical testing by Cayden at Azteca has yielded positive results”

In the coming days we will be writing about some other companies operating in the immediate area of El Barqueno and Guachinango where the mines were first discovered in 1544-1545


Dudley Pierce Baker