Baillie Gifford Us Growth Share Discussion Threads

[ben gunn] 10/1/2008 08:46

Update
The 20 day moving average for the NAS Comp has broken down through the 200 day line this week. Naturally after 8 straight days of falls the NAS gave a strong late bounce yesterday and I should expect more of the same in NEW York Thursday a.m.. he down trend remains in place.

IBGS (The short dated Euro denominated etf collection of government bonds) has risen to 99 but I would now expect its rise to falter after such energy. If the EMC cuts Uk interest rates then the rise will renew otherwise it may retreat making today a poor day to add to holdings. Perhaps wait at least until it slips back to its 5 day moving average price of 98.3.

The FT has carried a letter of mine calling for a 2 basis points global tax on derivative positions to calm the markets down:

Sir, Lex reports ("Quant investing", January 3) that no investment manager is looking at quant packages in quite the same way after one turbulent week in August. Quite. In future, Lex expects turbulence to be tamed by managers forgoing profit by using more restrained gearing. Not quite so likely.

Two "issues" have arisen in today's financial markets. First, trading using derivatives is practically cost-free so there is a strong bias towards taking active positions. Introducing even a globally policed "fee" of 2 basis points would calm financial markets to a remarkable degree.

Second, investment managers' main boards (let alone their regulators) have precious little idea of what their more exuberant traders are up to "intra-month". This has led to extreme intra-month peaks and troughs. For banks and so on making more than 20 per cent of their earnings from trading, the production and formal review of mid-month balance sheets should become mandatory.

This may encourage further calming at little cost. Less gearing would, of course, also be admirable.

Ben

[ben gunn] 04/1/2008 21:59

HAPPY NEW YEAR
The Euro based bonds (such as IBGI which is up 17% over 6 months) are showing particularly well turbocharged by sterling's stumble.
High Yield bonds have all been sold in favour of Government stuff.


Ample's charts of the NAS are down so:
a) Intel, as a proxy for NAS, is over 6% down, crashed back down through the 200 day line to a new low for 3 years....headline stuff!
b) DOW is sharply down to a point matching its November low. The 200 day line is flat and can be expected to resume its downward track of November. This may shortly trigger the Digital Investing Culcutta convention when we no longer expect a recovery of the index to its 200 day line so the only clear rule is to sell.

Monday may bring short term relief to equities but if the DOW falls further over the next week it will reveal a new lower low for the last 6 months and that may trigger some dramatic technical trades. Liquidity will dry up and on-line NMS will shrink on smaller stocks.

Agressive switching to Bonds has already paid off hansomely since the end of November and we can comfortably anticipate a successful Jan 2008 after a very mixed 2007.

[ben gunn] 22/11/2007 10:31

After the Bull
Last night's close of the NAS Comp strongly bellow its 200 day moving average gives us the clear signal of the arrival of the bear market.

The pace of the fall means that a government bond price pullback can be expected so purchases should be finessed as others have been buying already.

Earlier this week I expressed on The Naked Trader BB:
I prefer IBGM to (10 to 15 year overseas govt bonds)to IGGX (3 to 5 Years).
They are up 0.7% this a.m. which is an annualised rate of return of 150%+ so I could even see BBJL buying some.
As soon as I see the pre open NAS at 1.15 p.m. I expect to buy a few more.
(Shares Mag recommended a short on RMV yesterday...seems to be happening)

If any lurkers are unsure what to do...de-risking should keep your options open either way.

Smarm, you wrote above about interest rates. I know that today we have very high bank rate and an inverted bond yield curve so some are worried about high rates going forward. As I see it going forward:
*Low taxation puts too much money in investors pockets
*wealth shifting from US spenders to asian savers puts cash in investors pockets.
*Week GDP growth in G7 countries frees up lots of spare cash which might otherwise have been invested
*Loopy loans to private equity fatcats is on hold for now.

These 5 factors all mean that if equities tank for 18 months people will be bidding yields on good government bonds down and down and down.
(This makes buy & hold on Property companies a poor bet as they have fixed price debt so as interest rates fall below 4% they will have to create massive provisions against their suddenly "overpriced" fixed rate debt)

Todays FT and the LSE falling 5% seem about as much signal as people need.

Good hunting and remember...only cash, govt bonds and overseas govt bonds can protect you from a recession if it comes.

[seagreen] 07/11/2007 15:09

20% up today

[seagreen] 07/11/2007 10:26

worth reading the latest presentation in header they are looking for a rerating and are cash positive

[seagreen] 31/10/2007 09:46

Well I did not collect last time and got out flat

Try again long at 90cents the mine is a little bit more developed and the team are on a road trip this week

[seagreen] 07/5/2007 14:08

Any of you with facility to buy Canadian shares should look very closely as this has 1 bagger easilya dn 2 bagger probbaly there is seriously ramped up production going on and a broker report with canadian $2.50 target on it
good luck

[seagreen] 04/5/2007 11:25

Oh yes sir we have lift off dont blink it will be Can$2 before you open your eyes

[seagreen] 19/4/2007 08:06

nice volume coming back to its all time highs looking for this to go to Can$2 failry smartly as the word gets out..of the production increase potential

[seagreen] 18/4/2007 15:17

1.5m traded so far the institutions are buying

[seagreen] 18/4/2007 15:12

I will limit it to 5 bagger for now...8-)

[nilip] 18/4/2007 14:30

Seagreen,

Could you elaborate on the header a little more please :-)

Good luck with this one m8, hope it multi-bags for you.

[seagreen] 18/4/2007 14:19

I was advised to buy into this company as a long term play with a potential to grow 5 times by a fund manager I admire who had seen the company presenting in London this week, I also joined one of the main guys behind the presentation who was over from Canada.

Clearly it would have been nice if I had known about it whne it was 20 cents!

Their view is that they have ppicekd up an incredible asset which is actually producing silver and has the potetnnial to double its output over the next year if the geologist reports turn out to be accurate as several of the mines were dug to a certain extent and then plugged and abandoned and they belive them to still contain a rich vein of silver.

The current large volume can be put down to new large investors coming aboard as the road show continues in Switzerland and Europe this week, versus some investors in on the original placing selling their shares and useing that money to buy in their warrants before they shortly expire.

Indeed my friend bought in at Can$1.15 and I have bought in yesterday at Can$1.0975 and by the end of yesterday it was Can$1.03. This volatility may continue for a while but my view is that if and when the biger institiutional orders arive I do not want to be behind them.

So if I have bought slightly too high I am not overly worried as once any overhang goes and the story evolves this promises to be a very exciting ride and it could og as high as Can$3 to $5.

The webb site is most iluminating and the management are highly rated.

Good luck......

[seagreen] 18/4/2007 14:07

LATEST PRESENTATION




Price at time of thread creation Can$1.03 bid 1.04 offer



U.S. Silver Corp. is a relatively new company having just gone public on the TSX Venture Exchange in early January of 2007 using the ticker symbol "USA". The Company purchased 100% of the assets of Coeur Silver Valley Inc. from Coeur d'Alene Mines in June 2006 for approximately $15 million.
U.S. Silver Corp. owns the Galena mine complex located in the heart of the Coeur D'Alene mining district one of the preeminent silver, lead and zinc producing areas in the world. This mine complex is the second most prolific silver mine in US history with over 200 million ounces of silver produced to date. Since 1953 this mine has produced 210 million ounces of silver, 159 million pounds of copper and 22 million pounds of lead from 9.9 million tons of combined silver-copper and silver-lead ore at average grades 21.26 ounces of silver, 0.80% copper and, 8.8% lead per ton of ore.

US Silver's property covers 11,000 acres over an area approximately 11 miles long East to West and 3 miles wide. The property contains two mines and one exploration shaft. The assets include four operating shafts, two operating flotation mills as well as extensive surface and underground mining equipment. The operating Galena mine is located near the center of the property with the Coeur Mine on care and maintenance about 1.5 miles West of the Galena Mine. The Caladay Exploration Shaft is located approximately 2 miles to the east of the Galena Mine.

Currently the Galena mine is operating at approximately 500 tons per day of silver-copper ore. The current plan will see the Galena mine increase to over 700 tons per day by mid year 2007. The intention is to ultimately get production from the Galena mine up to 1100 tons per day as that is the capacity at the Galena mill. This level of production is forecast to be achieved sometime in 2008 after the Galena shaft has been rehabilitated. Repair work on the Galena shaft has started but in the meantime the #3 shaft will be our only hoist for the silver-copper ore.

The company will also initiate lead-silver mining later this year with the intention of hoisting this ore through the Coeur Shaft and processing the material at approximately 400 tons per day at the Coeur Mill. The company has recently signed a new off-take contract with TeckCominco to smelt the lead-silver concentrate starting in September of 2007.

The estimation of mineral Reserves begins with identification of Resource blocks, which include all mineralization. The Resource estimation methodology therefore includes material subsequently classed as Reserves. The Birak Technical Report stated tonnages and grades of Resources and Reserves separately, that is, Resource figures do not include Reserves, and the Resources and Reserves figures were thus additive. CAM has adopted the more common industry practice of including Reserve tonnages within Resource tonnages, so that amounts set forth in the CAM Technical Report, and in this Filing Statement, show Reserves as a sub-set of Resources.

On the Properties, there are 118 named or numbered veins containing currently reported Resources of silver mineralization. These are summarized on Table 1-2 below. Veins which have been mined out in the past, or which do not have sufficient exploration to define a Resource, are excluded from discussion in this report.



CAM was provided with the exploration database used in the prior Resource estimate as reported in the Birak Technical Report. This database is in the Microsoft Access format used by the Gemcom mine planning software. The cutoff for defining Resource blocks was the same (19 oz/ton Ag eq) as used in defining Reserves. Three different techniques were used by CSV to prepare resource models reported on in the Birak Technical Report:

1. The Accumulation Method. In this method the average true width and grade is averaged for all of the vein composites within and surrounding an area of interest.

2. The Polygonal or Nearest Neighbor Method. In this method the width of the vein and grade for each vein composite is extended out to a limiting distance or half way to the nearest composited interval.

3. The Wireframe and Block Model Method In this method the shape of each vein is interpreted on plan and/or section and the interpretations are linked together to form a true 3-D model of the shape of the vein. Composites within the interpreted shape are used to interpolate regular or irregular 3-D blocks which intersect or are within the interpreted vein volume. US Silver used kriging to estimate block values in regular blocks and then calculated Resources by a weighted average of the portion of the block which intersect in the wireframe.

All three of these methods are accepted engineering practice. The method most appropriate for each vein was selected by Coeur for use in the Birak Technical Report, which therefore serves as the basis for the Resource estimate for U.S. Silver presented herein. CAM believes that the selection of Resource modeling methodology is appropriate for this type of deposit. In addition, CAM performed a statistically significant number of statistical checks of the three model methods, and found that the model methods appeared to conform to accepted engineering practice.

CAM confirmed the validity of the Coeur Resource inventory in the veins, as shown in Tables 1-3 and 1-4, below. There are differences between Birak Technical Report and the present CAM review on the order of one-quarter of one percent (.0025) in tonnage and less than two percent (.02) in contained silver, probably due to a combination of rounding and clerical errors.




In order to calculate the minable Reserve portion of the measured and indicated Resource, the economic portion of the Resource is typically determined by the application of a breakeven cutoff grade, or value, that considers the total operating cost (mine, plant and administration), metal price(s), process recovery(s), applicable royalties, and forward costs for concentrate freight, insurance, smelting and/or refining. These parameters are equated to determine the minimum grade, grade equivalent, or value of metal(s) that must be mined in order to cover these total direct operating costs. Currently, at the Galena mine, copper/silver ores are mined and processed to produce a copper concentrate, with silver as the primary value. Therefore, the breakeven cutoff is expressed as a silver equivalent grade. The economic parameters applicable to a steady state production rate of 750 stpd were used to estimate the silver equivalent breakeven cutoff grade. The resultant equivalent-silver grade (using U.S.$6.50/oz price for silver and U.S.$1.30/lb for copper) is approximately 19 oz/dst Ageq.

Typically, the breakeven cutoff grade is used to identify the proven/probable economic portion of the measured and indicated Resource. Regular mining shapes drawn around this portion of the Resource may include some sub-economic material that must be taken in the mine planning and stoping process. In addition, some blocks may have to be dropped due to their location outside of the mining shapes, or due to excessive development to access the blocks. The grade within the mining shapes is then recalculated, and factors for mining dilution and recovery applied to arrive at the final proven and probable minable Reserve.

On the other hand, to calculate the Galena mine Reserves, U.S. Silver and its predecessor Coeur calculated the values of measured, indicated and inferred blocks contained within shapes drawn around measured, indicated and inferred Resources. The shape width is assigned by the engineers/geologists, based on the vein width, mining method, mining equipment required, and the minimum mining width including dilution. The value of each Resource category is calculated from the model blocks contained within the shape. This value is then compared with the estimated costs associated with mining the shape, including depletion, depreciation, and amortization. The shape's net value (positive or negative) is recorded. If positive, the tonnage and grade within the shape is designated as "Reserve." If negative, the tonnage and grade may be included as "Reserve", if the contribution to overhead is significant. Those shapes with the least contribution to overhead have been deleted. No further factoring is performed for dilution outside the mining shape, nor is a factor for recovery included in the Reserve calculation. This method has been in use for some time at the property and is believed to result in a fair estimate of proven and probable Reserves.

Since the methodology used to calculate the Galena Mine Reserves is not standard practice within the industry, but is standard within the district, CAM performed extensive checks of the tonnage and grades for several of the larger Coeur/Galena-calculated mining blocks. CAM was unable to make a complete check without re-calculating the Reserve using conventional methods. However, CAM believes it performed sufficient evaluations of the Resource model, and spot checks of the conversion process from Resources to minable Reserves, to indicate that the published U.S. Silver silver-copper Reserve probably reflects the economically viable portion of the silver-copper Resource.

Pursuant to CAM's recommendation, none of the silver-lead deposits have been included within the Reserves table shown in this Filing Statement, principally because U.S. Silver's existing smelter contracts do not pay for lead in the bulk sulfide concentrate and the Galena mill is not currently configured to make a lead concentrate. Moreover, as at the date of the CAM Technical Report, U.S. Silver had not adopted a mine plan for the processing of this silver-lead ore. CAM has noted that at such time that U.S. Silver completes its study (currently in progress) showing the feasibility of producing and marketing lead-silver concentrate, the status of these deposits as "Reserve" can be restored.

In order to calculate the minable Reserve portion of the measured and indicated Resource, the economic portion of the Resource is typically determined by the application of a breakeven cutoff grade, or value, that considers the total operating cost (mine, plant and administration), metal price(s), process recovery(s), applicable royalties, and forward costs for concentrate freight, insurance, smelting and/or refining. These parameters are equated to determine the minimum grade, grade equivalent, or value of metal(s) that must be mined in order to cover these total direct operating costs. Currently, at the Galena mine, copper/silver ores are mined and processed to produce a copper concentrate, with silver as the primary value. Therefore, the breakeven cutoff is expressed as a silver equivalent grade. The economic parameters applicable to a steady state production rate of 750 stpd were used to estimate the silver equivalent breakeven cutoff grade. The resultant equivalent-silver grade (using U.S.$6.50/oz price for silver and U.S.$1.30/lb for copper) is approximately 19 oz/dst Ageq.

Typically, the breakeven cutoff grade is used to identify the proven/probable economic portion of the measured and indicated Resource. Regular mining shapes drawn around this portion of the Resource may include some sub-economic material that must be taken in the mine planning and stoping process. In addition, some blocks may have to be dropped due to their location outside of the mining shapes, or due to excessive development to access the blocks. The grade within the mining shapes is then recalculated, and factors for mining dilution and recovery applied to arrive at the final proven and probable minable Reserve.

On the other hand, to calculate the Galena mine Reserves, U.S. Silver and its predecessor Coeur calculated the values of measured, indicated and inferred blocks contained within shapes drawn around measured, indicated and inferred Resources. The shape width is assigned by the engineers/geologists, based on the vein width, mining method, mining equipment required, and the minimum mining width including dilution. The value of each Resource category is calculated from the model blocks contained within the shape. This value is then compared with the estimated costs associated with mining the shape, including depletion, depreciation, and amortization. The shape's net value (positive or negative) is recorded. If positive, the tonnage and grade within the shape is designated as "Reserve." If negative, the tonnage and grade may be included as "Reserve", if the contribution to overhead is significant. Those shapes with the least contribution to overhead have been deleted. No further factoring is performed for dilution outside the mining shape, nor is a factor for recovery included in the Reserve calculation. This method has been in use for some time at the property and is believed to result in a fair estimate of proven and probable Reserves.

Since the methodology used to calculate the Galena Mine Reserves is not standard practice within the industry, but is standard within the district, CAM performed extensive checks of the tonnage and grades for several of the larger Coeur/Galena-calculated mining blocks. CAM was unable to make a complete check without re-calculating the Reserve using conventional methods. However, CAM believes it performed sufficient evaluations of the Resource model, and spot checks of the conversion process from Resources to minable Reserves, to indicate that the published U.S. Silver silver-copper Reserve probably reflects the economically viable portion of the silver-copper Resource.

Pursuant to CAM's recommendation, none of the silver-lead deposits have been included within the Reserves table shown in this Filing Statement, principally because U.S. Silver's existing smelter contracts do not pay for lead in the bulk sulfide concentrate and the Galena mill is not currently configured to make a lead concentrate. Moreover, as at the date of the CAM Technical Report, U.S. Silver had not adopted a mine plan for the processing of this silver-lead ore. CAM has noted that at such time that U.S. Silver completes its study (currently in progress) showing the feasibility of producing and marketing lead-silver concentrate, the status of these deposits as "Reserve" can be restored.



Reconciliations of mined production versus Resource blocks mined were analyzed by CAM for the years 2003, 2004, and 2005. This analysis indicated that the tons and ounces delivered to the mill were greater than what was contained in Resource/Reserve blocks, with results generally outside the ± 15% which CAM regards as potentially acceptable. Discussions with the mine staff indicated that most of the variability and positive reconciliation was due to ore which was found during actual mining but not included in the Resource model. According to the mine staff, this reconciliation is usual for mines in the district given the long history of the district. The CAM Technical Report suggests that this trend may continue. However, CAM suggests that it may be possible to obtain a better reconciliation, at least in terms of averages, by making sure that the Resource associated with all ore grade intercepts in the drill holes in the vicinity of veins are included in the Resource estimate by using some type of polygonal estimate, with search radii subparallel to the trend of each vein.

[ben gunn] 07/3/2007 23:27

Not so much a double top as a complete set of udders!

[ben gunn] 22/2/2007 13:58

January quarterly profits from the USA were fully satisfactory and despite a severe hic-cup in the 3rd/4th week of January the equity markets are racing away. The Treasury has not spooked them, the continued collapse of housing has not spooked them but rising inflation might. Expect rises until 28th March. 10Year UK interest rate now firmly above 4.85% making bonds a clear sell for now. If I am cheeky I would point out that the second para. above predicted the UK's 3rd. interest rate rise in Jan. 07.

I was busy over January switching the family resources out of the bond "safe haven!" back into equities such as Mears ROK and MCI. I also took out some more adventurous positions in PC Group, PMK and CSR (not to mention neteller now suspended so I wont). This means that after some missed oportunities in Oct and Dec that beta is again being generated and new highs are being seen weekly in most portfolios.

For March (off for 9 days to ski in the ALPS) I expect more of the same and an even more top heavy index awaiting the April results when we shall see what we shall see.

[ben gunn] 19/12/2006 16:49

19th December
Uncertainty has bitten for 2 days as traders settle down to drink their bonuses in style. US bonds have held firm but in the UK 10 year bond yields have recovered from 4.48% to 4.71% as wage rises, tight skilled labour market and house price rises threaten the need for another 1/4% interest rate rise PDQ (although the majority of economists were not expecting it one month ago).

Oddly US interest rates (5.25%) are above UK interest rates (5.0%) whereas the 10 year rates in the US are lower. One possible outturn will be a first fall in the US interest rates whilst a third rise in UK rates seems possible when more data is at hand. EU rates are also expected to continue to rise.

Equity markets have been so strong with the UK up around 3% in the first half of December that a weakening into the holiday season is a reasonable expectation. As this will produce an apparent double top at the twin peaks of 16th Nov and 15th Dec 2006 every week that such a trend persists may give it more and more credibility. Tight stop losses are the order of the day together with a higher than usual emphasis on Europe ,Far East and BRIC markets.

5th Jan update: Strong US employment & wages data have sent US 10 year bond yields up to 4.68% and UK to 4.82%.
Unusually, shares are also off as the recent collapse in commodity prices and further steep falls in oil prices have combined with Motorola's profit warning this a.m. (down 11%) to remind traders that we are less than 2 weeks from the January results season and the breathtaking quarterly profit reports may stop this quarter. (i.e. people may speculate to pre-empt a price fall following January Results). Expect no more than ruffled waters until Jan results are known.

[ben gunn] 09/12/2006 18:38

The dollar has continued to surprise us on the upside and the 8th December employment figures were about as good as one could expect. During the autumn considerable conflict was seen in some of the data (partly owing to last year's hurricane's) but this has resolved into a "pretty rosy but economicly weak" picture going forward. For Wall Street this translates into a "soft landing" for companies and the economy and continued confidence.

I now expect a strong week up to 15th December when the finance houses close their books followed by continued uncertainty. Bonds had a sticky October but I stood by my holdings and bonds are continuing to show weak, but positive, buy signals.

I expect equity strength until 15th Dec and then uncertainty rules as poorer economic news sends the market down but expectation of sound recovery in late 2007 encourages further speculative buying. If the markets show a truely mixed reaction to economic news then the difference will be made on the downside by further political problems for Mr Bush. And, on the upside, by gentle winter weather in the US raising world stocks of oil and gas with implicit weakening fuel prices.

[ben gunn] 24/9/2006 17:36

The last 2 weeks have seen a 2% plus gain in the NAS Comp to 2118 which is pretty healthy for a "Fluctuating pattern". The week closed, however, on a note of considerable weakness as the poor production figures from the US's rust belt area combined with signs of terminal decline in the US car industry slashed confidence.
Bonds took the lead and yields tumbled remarkably strongly particularly over 10 years or more. This reflects the reduced prospect of further interest rate rises as only headline inflation may be pressing the Fed to consider further rate rises from a historicly high 5.25%. So I now expect the downward leg of fluctuations but no immediate clarity can be expected as it was only a quarter ago growth was hitting new highs and signals continue to conflict. Forecasters are aware of both the direct and indirect effects that the bursting of the property bubble in the US can produce in the coming months. The Dollar index, 92.6, will serve as our index of confidence going forwards and I expect it to fall at about 0.2% a week until mid October when the quarterly results from Wall Street will push it back up or increase the rate of decline.
Friday saw solid gains in gold as well as bonds and the emerging markets are now hit below the waterline by the continued fall in metals and commodity prices.

[ben gunn] 08/9/2006 17:50

The mixed news in the states over tech stocks performance, future interest rates and poor housing outlook has stopped the recent 2 month recovery stone dead. The fact that the DOW gapped down in 2 out of the 4 trading days adds to the uncertainty of the picture:
For the next fortnight we could see a fluctuating pattern or a fall. The NAS's direction from today's 2160/2180 level will reveal which it is to be and as it falls back to significant cross over points the NAS could indicate down positions worth taking.

NB The FT had an interesting article on the many reasons why the key US investment banks that report quarterly performance in OCT must show poor results year on year for the first time in ages.

N.The DOW's possible failure to retake 11,400 today may look significant in the weeks to come.

[ben gunn] 28/7/2006 11:05

Good news
Weak buying signals for gilts are now in place alongside strong buying signals for index linked gilts. I shall wait until the 9th August decision is behind us but it is comforting to know that the bond market has finally made up its mind.