Source: Michael J. Ballanger for Streetwise Reports 07/17/2018
Precious metals expert Michael Ballanger discusses movements in the base metals sector, as well as in precious metals.
met·tle [ˈmedl] NOUN
“a person’s ability to cope well with difficulties or to face a demanding situation in a spirited and resilient way.”
My beloved Fido is an awesome pet and one truly remarkable canine. Not only is he as strong as a bull, great with children, highly protective and unwaveringly obedient, he is also able to disembowel toy giraffes and imitation grizzly bears with wondrous aplomb and frightening fervor. As a particularly hectic three days had passed without the pleasure of his company, I asked my patience-of-Jobe partner where he might be hiding, given that I thought I had weaned him off the irritating habit of hiding under the tool shed every time I embark on one of my vitriolic tirades complete with soaring desk adornments and tumbling furniture. I had just completed an exceedingly unsightly excavation of the sub-toolshed cavern in search of my fine canine when I was reminded that the trusty lad went missing on July 5th, a day which saw trade war fears torpedo “all things metal” and slam energy and grains but MAGICALLY allow for sharp gains in stocks.
What happened that morning was that after the desk lamp went flying into the “wild blue,” I allegedly grabbed a family heirloom given to me by a distant American cousin and attempted to use it as a weapon. You see, my cousin barely survived the Mount St. Helens volcanic eruption that literally obliterated the mountain and everyone living on it. My cousin had sent me a memento, which was a glass ball with water and a small imitation town named St. Helens that, when you shook it, rained down volcanic ash in the same manner that those Christmas snow globes create the semblance of a snowfall. In a moment of ill-timed outrage, I imagined the “volcano globe” as a five-pin bowling ball and proceeded to hum it down the hallway at what appeared to be five decorative pink flamingos closely resembling bowling pins. At the very last moment, the flamingos revealed themselves as Fido’s legs prompting a screeching, “Fido JUMP!” Barely missing the barreling ball, Fido raced from the room and the house and, most importantly, my VILE presence, never to be heard from nor seen ever again. Meanwhile the speeding orb slammed into the door jamb and exploded into a shower of glass, water, imitation post office and general stores and a disgusting film of “real Mount St. Helens ash” all over the just-washed kitchen floor. Needless to say, I was, for the remainder of the day, persona non grata in the eyes and minds of both the canine and non-canine inhabitants of our humble abode.
Now as upset as I was at losing the volcano globe, I could not have been nearly as upset as the zinc zealots and copper cowboys that are now bleeding from the eye sockets from their unwavering and unconscionable worship of the “base metals trade” all based on inflationary expectations and global growth. What they forget is that by the time they are discussing the fundamentals for ANY trade in an internet forum, the guys that convinced you to buy (that make a living off driving volume) have sold. They are gone; they have vamoosed; they and the King have LEFT THE BUILDING. You, in your undying loyalty to the now-dated ownership rationale, are left holding a very large and very empty bag. I could cite more than a few examples of this but there is none more glaring than Noront Resources back in 2009 that was “THE NEXT COMING OF VOISEY’S BAY!!!!” I recall IBK Capital Founder Bill White holding the Jacquie McNish book on Bob Friedland and the Voisey’s Bay nickel discovery over his head urging some 200 attendees to “BUY THIS BOOK!” or miss out forever! Well, Noront is now at $0.36 after hitting an all-time high north of $7.00 in 2010.
Prominent fund managers took massive losses on Noront and then a small group of them actually removed management after the stock peaked at $7.25. It was one of the most masterful mining promotions to ever grace the hallowed halls of Bay Street, and it made a lot of the early speculators fortunes while those that continued to echo the “next Voisey’s Bay” meme were crushed. And that is exactly how the much-daunted “Trump Inflation Trade” has been replaced with the “Trump Trade War Dump” while all of the base metal bag holders continue to echo the very old and very stale “global demand/supply tightness” mantra all the way down from copper $3.30/lb to the very painful $2.76/lb. Classic…
Copper is down 15.3% from $3.30/lb a month ago and sits a snick above $2.80. Zinc is down 19.49% in the same period while lead is down a paltry 11.1% over the same period. These are ONE-MONTH hits and they are wreaking havoc on managed money P&L’s “Business First!” hero, Donald J. Trump, has brought all of this on with his bellicose attitude toward literally every country on the planet. “If ya’a ain’t WIF me, ya mus’ be AGIN me!” is the mantra carried into battle by this self-proclaimed “swamp drainer” and he is certainly proving it with his anti-China bellicosity. For a man whose business endeavors have included more than his share of bankruptcy filings, DJT is playing a high stakes game of poker with the one country that holds all of the ink that winds up on the cards.
I was in a small touristy-type shop on Frying Pan Island in western Georgian Bay yesterday and there was an $80 sweatshirt with the marina’s name on it that was tagged “Made in China” that you could buy in any Dollarama for under $10. If DJT isn’t careful, the Chinese might decide to …read more
From:: The Gold Report