{"id":6286,"date":"2015-02-23T14:51:19","date_gmt":"2015-02-23T14:51:19","guid":{"rendered":"http:\/\/juniorminingnews.com\/?p=6286"},"modified":"2015-02-23T14:51:19","modified_gmt":"2015-02-23T14:51:19","slug":"video-john-kaiser-proposes-a-new-system-for-financing-junior-miners","status":"publish","type":"post","link":"https:\/\/juniorminingnews.com\/?p=6286","title":{"rendered":"Video: John Kaiser proposes a new system for financing junior miners"},"content":{"rendered":"<p><span class=\"grey-date\" style=\"font-weight: normal; color: #aaabab;\"><a href=\"http:\/\/juniorminingnews.com\/wp-content\/uploads\/2015\/02\/ceo-ca.jpeg\"><img decoding=\"async\" loading=\"lazy\" class=\"alignleft wp-image-6287 size-full\" src=\"http:\/\/juniorminingnews.com\/wp-content\/uploads\/2015\/02\/ceo-ca.jpeg\" alt=\"ceo-ca\" width=\"240\" height=\"63\" data-id=\"6287\" \/><\/a>POSTED ON FEBRUARY 19, 2015 BY\u00a0<a style=\"color: #931a28;\" href=\"http:\/\/ceo.ca\/author\/tommy-humphreys\/\">TOMMY HUMPHREYS<\/a><\/span><br style=\"font-weight: normal; color: #222222;\" \/><span class=\"grey-date\" style=\"font-weight: normal; color: #aaabab;\">CATEGORY\u00a0<a style=\"color: #931a28;\" href=\"http:\/\/ceo.ca\/category\/featured-interview\">FEATURED INTERVIEW<\/a>,\u00a0<a style=\"color: #931a28;\" href=\"http:\/\/ceo.ca\/category\/john-kaiser\">JOHN KAISER<\/a>,\u00a0<a style=\"color: #7e1622;\" href=\"http:\/\/ceo.ca\/category\/mineral-exploration\">MINERAL EXPLORATION<\/a><\/span><\/p>\n<p style=\"font-weight: normal; color: #222222;\"><iframe loading=\"lazy\" src=\"https:\/\/www.youtube.com\/embed\/rv4QS94_2nI\" width=\"560\" height=\"315\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<p style=\"font-weight: normal; color: #222222;\">In the good old days of Howe Street, venture stock-brokers would act as an intermediary between junior mining companies and investors. This is a somewhat murky ethical practice of the brokers having two masters, both the companies they were helping to get off the ground, and the clients with which they were to serve. Investors tolerated this conflict of interest because they knew what they were getting into, and sometimes, they made a lot of money backing early stage deals.<\/p>\n<p style=\"font-weight: normal; color: #222222;\">However, in recent years, large banks have consolidated the brokerage business, now controlling 95% of Canada\u2019s wealth, according to some estimates. The banks do not want their brokers and clients to play in speculative securities like junior miners because of the risks and perceived conflicts of interest. Also, the big banks want to earn a management fee on assets over the long term. Short term transactional business, while excellent in boom years, is not a consistent business model for them.<\/p>\n<p style=\"font-weight: normal; color: #222222;\">These are not the only challenges facing the capital formation process for junior miners, according to veteran TSXV analyst John Kaiser. High frequency trading, discount brokerages, and declining commodity prices have all but killed the after-market for shares in junior miners. The result is a system that is collapsing on itself.<\/p>\n<p style=\"font-weight: normal; color: #222222;\">Kaiser believes the easiest way to bolster the sector, which exists to provide capital to find and develop new mines, is to abolish Accredited Investor Exemption rules that currently restrict non-rich people from giving money directly to the treasuries of these companies. Currently, only Accredited Investors, or those making over $200,000 annually or with more than $1,000,000 in liquid assets, are able to give money directly to companies in exchange for shares, while those earning less than those thresholds are restricted to buying shares in the open market. This is a bit of an oversimplification, and there are some exceptions to this.<\/p>\n<p style=\"font-weight: normal; color: #222222;\">\u201cNet worth does not imply sophistication,\u201d Kaiser has said, and he believes that eliminating these restrictions will open up an enormous new audience of investors to the sector, which could help get discoveries and development going again, even in a declining commodity price environment.<\/p>\n<p style=\"font-weight: normal; color: #222222;\">The existing regulatory and disclosure practices of Canada\u2019s junior public companies should be leveraged into a new financing system for junior miners, Kaiser believes. He envisions a web-based system whereby regular, non-Accredited investors with accounts that are 100% their responsibility, with no compensated intermediary, should be able to invest directly in early stage companies. He went as far as to propose a 48 hour \u201cBuyers Remorse\u201d window so investors can back-out of their purchases, in case they drank too much wine or were charmed by promoters into investing in something they\u2019re not comfortable with.<\/p>\n<p style=\"font-weight: normal; color: #222222;\">\u201cWhen it closes, the money gets swept to the company, and the certs and warrants get swept into the clients accounts, and a processing fee, maybe .2% or .4% gets charged, rather than the 8%-12% that the conflict of interest soaked trusted intermediaries have been socking the companies with in the private placement mechanism.\u201d<\/p>\n<p style=\"font-weight: normal; color: #222222;\">Kaiser believes the venture brokerage industry is history.<\/p>\n<p style=\"font-weight: normal; color: #222222;\">\u201cThe roles that they used to play are no longer viable.\u201d<\/p>\n<p style=\"font-weight: normal; color: #222222;\">We discussed this in\u00a0<a style=\"color: #931a28;\" href=\"http:\/\/chat.ceo.ca\/\" target=\"_blank\">chat.ceo.ca<\/a>\u00a0yesterday and a smart aspiring broker, Riley Skinner, provided a quality rebuttal to Kaiser.<\/p>\n<p style=\"font-weight: normal; color: #222222;\">\u201cThe real money is made on finding good positions for your clients and taking positions with them, maybe even being a part of putting the deals together. It\u2019s much more entrepreneurial than the Wealth Management model. Creation, not extraction. \u2013 speaking from no experience.\u201d<\/p>\n<p style=\"font-weight: normal; color: #222222;\">Riley continued, \u201cNot to mention the fact that only a few places \u201cspecialize\u201d in it anymore. The margins may be slimmer, but the pie is much greater.\u201d<\/p>\n<p style=\"font-weight: normal; color: #222222;\">Kaiser was not all doom and gloom during our interview, noting that the degree of professionalism that has entered the mining sector has never been stronger and will not go away.<\/p>\n<p style=\"font-weight: normal; color: #222222;\">He made the case for speculative investors to begin paying attention to mining explorers and developers because of the finitude of the upside potential.<\/p>\n<p style=\"font-weight: normal; color: #222222;\">\u201cYou can quantify the success potential of an exploration play much more effectively than you can some new medical device or new mobile app,\u201d Kaiser said. \u201cThese things are all benefiting from the giant momentum that\u2019s on the upside, this momentum is peaking right now, this will all be descending into the garbage can over the next five years. During this period, people who want to make high risk, high reward bets should be looking at the resource sector.\u201d<\/p>\n<p style=\"font-weight: normal; color: #222222;\">\u201cIf you want to gamble in juniors, you need ten different stocks to diversify that risk. If you think you can pick the one stock that\u2019s going to be a home run, I guarantee you will lose.\u201d<\/p>\n<p style=\"font-weight: normal; color: #222222;\">\u201cI agree there\u2019s been a lot of mismanagement, but there\u2019s also been excellent management, and we\u2019re now seeing a winnowing from the wheat from the chaff.\u201d<\/p>\n<p style=\"font-weight: normal; color: #222222;\">\u201cWhen the tide rises, most of the boats are going to be tethered to the dock and are just going to hang there and go nowhere.\u201d<\/p>\n<p style=\"font-weight: normal; color: #222222;\">It has been a privilege to get to know John through time spent together at Cambridge House conferences, and as a subscriber to his newsletter ($250\/90 days\u00a0<a style=\"color: #931a28;\" href=\"https:\/\/secure.kaiserresearch.com\/s\/RegisterNewUser.asp\" target=\"_blank\">here<\/a>). Consider a subscription as there is no equivalent junior mining research tool.<\/p>\n<p style=\"font-weight: normal; color: #222222;\">Enjoy this post? Pass it around!<\/p>\n<p><strong style=\"font-weight: bold !important; color: #0b507c;\"><em style=\"font-style: italic;\">Advertisement<\/em>:<\/strong><b style=\"font-weight: bold !important; color: #0b507c;\"><a style=\"color: #ed671a;\" href=\"http:\/\/commonstockwarrants.com\/wp-content\/uploads\/2014\/07\/tableheadwarrantcombined.png\"><img decoding=\"async\" loading=\"lazy\" class=\"aligncenter size-full wp-image-53085\" src=\"http:\/\/commonstockwarrants.com\/wp-content\/uploads\/2014\/07\/tableheadwarrantcombined.png\" alt=\"tableheadwarrantcombined\" width=\"702\" height=\"202\" \/><\/a>Join us at CommonStockWarrants.com for the only listing and details on all stock warrants trading in the United States and Canada. All industries and sectors are represented and many opportunites for investors. Don\u2019t overlook\u00a0this unique opportunity.\u00a0<strong style=\"font-weight: bold !important;\"><a style=\"color: #1d72d1;\" href=\"http:\/\/commonstockwarrants.com\/\" target=\"_blank\">Visit our website now<\/a><\/strong>.<\/b><\/p>\n","protected":false},"excerpt":{"rendered":"<p>POSTED ON FEBRUARY 19, 2015 BY\u00a0TOMMY HUMPHREYSCATEGORY\u00a0FEATURED INTERVIEW,\u00a0JOHN KAISER,\u00a0MINERAL EXPLORATION In the good old days of Howe Street, venture stock-brokers would act as an intermediary between junior mining companies and investors. This is a somewhat murky ethical practice of the brokers having two masters, both the companies they were helping to get off the ground, [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":6287,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"footnotes":""},"categories":[4],"tags":[160,138,137,161],"_links":{"self":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts\/6286"}],"collection":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=6286"}],"version-history":[{"count":1,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts\/6286\/revisions"}],"predecessor-version":[{"id":6288,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts\/6286\/revisions\/6288"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/media\/6287"}],"wp:attachment":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=6286"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=6286"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=6286"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}