Tag: markets

An ironic step forward for Stop Pebble Mine?

savebristolbayYou can create motion pictures detailing the horror, lobby decision makers, and conduct widespread public relations campaigns including but not limited to promoting the cause via social media. They are all worthy efforts because they bring the issue to a forefront and highlight how much humans care about their surroundings. Sometimes emotions can win people over.

Meanwhile, markets ALWAYS win people over. They are the single invariably precise accumulation of the opinions of any and all stakeholders. And they seem to think Pebble Mine might not be worth the money

After updating their precious metals’ company cost curve, Citi’s ominous warning that, “a combination of rising unit costs (15% yoy), sustained high capital budgets and a falling gold price have resulted in a fast contraction in margins – so much that no gold company under our coverage will generate Free Cash Flow at spot gold.”

The news is in reality one very small step for fish, and barely a skip/hop for mankind – gold prices can swing wildly just like any other commodity. But the law of supply and demand rarely strays from form, and if big gold funds such as John Paulson’s continue their ugly slides at least the latter half of the most basic of economic models won’t be capable of sustaining prices, let alone drive mine tailings down a salmon run.

MG signing off (because the simplest answer doesn’t always rear its head from the start)

Will the Recent Swathe of Telco Mergers Make Things Better?

We have seen a flurry of telecomm deals in the past few weeks. SBC gets AT&T for the enterprise book, and MCI finds a suitor in Verizon (hopefully ending their saga once and for all). But does it matter?

The markets feelings on the situation swing between exuberant to non-existent, depending on whether the deal was a foregone conclusion (see Forbes.com: Stocks Narrowly Mixed on Verizon-MCI Deal), or what after-effects the signed contract will bring (SBC to Cut 13,000 Jobs After Buying AT&T).

Again, what benefits are we going to see? I suspect there will be some alternating pleasures and pains.

Major Bank Embroiled in Money Making Plans

A Guardian Unlimited report yesterday declared Citigroup embroiled in bond selling scandal. According to the report, a couple of traders on the other side of the pond purportedly exchanged a memo where they conspired amongst themselves to make some money. Can you believe it? Securities traders planning to make money. As far as I can see, the only stupid thing they did was talk about it too much before they actually did it.