Blackrock World Mining Share Discussion Threads

[llef] 03/2/2016 11:58

EI - true, but I think it might be more like nano-sized version of sub prime, as homeloans were/are predicated on appreciating assets (houses), whereas car loans were/are predicated on depreciating assets (cars).

if a 7 year car loan goes sour after 3 years, then the debtor has already paid a chunk of the original principal back.
(e.g.Example attached shows a 7 year 25k loan would have reduced to 6k after 5 years versus a residual car value of 11k)

hxxps://www.cars.com/articles/2014/09/seven-year-car-loans-are-growing-but-beware/

[essentialinvestor] 03/2/2016 11:37

llef, fair point although as an aside you may hear a lot more on those US
car loans come the next recession, it may morph in to a mini version
of sub prime imv.

Best to stay open minded, anyone calling for crude in the $20's 12 months
ago may have been regarded as ridiculously bearish, yet it is where we
ended up recently.

On the flip side thought IO would be in the mid $30's by now, it is closer
to the mid 40's.

[llef] 03/2/2016 11:27

if usa is in recession, or heading towards it, no one has told the car market in the states...

"US auto sales rose at the fastest pace since 2000 in January even after a historic blizzard that swallowed major cities in the Northeast.

According to Autodata, sales rose at a seasonally adjusted annual rate of 17.58 million in January"

hxxp://www.techinsider.io/us-auto-sales-january-2016-2

[rcturner2] 03/2/2016 10:21

Halving from 200p to 100p is entirely possible here and we are almost half way to that anyway at the current share price.

[essentialinvestor] 03/2/2016 09:34

Had hoped to add back a small amount of RIO under 15.95 this AM,
but no chance with IO looking more perky.
The RIO price is heavily tied to US markets so tends to move around
with US futures - the IO uplift also now supportive - is this temporary?.

[aleman] 03/2/2016 09:29

Very helpful.

Aluminium looks like it might have touched a 4 month high overnight. Zinc is at a near 4-month high. They haven't all done it at the same time but they all seem to be gradually turning up on the back of falling stocks.




The Mining Index is rising again this morning after yesterday's credit rating downgrades. BRWM is ignoring rising miner's shares again. It's been doing it for about 3 weeks now. Strange.


free stock charts from uk.advfn.com

[rcturner2] 03/2/2016 08:28

Q. How does a stock fall by 90%?
A. First it falls 80% and then it halves in value.

[aleman] 03/2/2016 08:11

BAse metals mor mixed today after being perky yesterday. Lead is, however, pushing for a 7-month high. Lead won;t mean a great deal to BRWM but the general trend still looks to be creeping upwards.

[rcturner2] 03/2/2016 08:10

racg, the fact that you think the share price is "absolutely shot" speaks volumes. I wish you well, I hope for you sake this does not tank further. However the effects of negative gearing have not yet applied to the miners, there is plenty of downside here. I would call the BRWM share price "dangerously high" and the risk is far more on the downside. Ignoring long term trend and momentum is a massive mistake.

[aleman] 03/2/2016 08:01

Better. Intereting points but the UK army (and police force) has been shrinking - does that mean we have been lying about GDP?

They can't hold land speculatively in China so develers have to build omething on what they buy. China was littered with half built, cheap as possible, concrete mostosities just to hold the land. The empty property numbers are a bit misleading, although it did undoubtedly create a bubble in cement output. Does that mean the while economy has fallen through? I don't think so, especially in what is still a command econmoy in some respects. Other indicators continue to indicate strong growth in the consumer sector as the economy rebalances and they deploy some of those resevres they built up to stimulate growth elsewhere. The story seems to hang together from the research I have done, not that I am convinced they tell the whole truth all the time. Show me any government that does.

[racg] 03/2/2016 07:59

No need to be a sore winner Turner. I think you rather overestimate your abilities but no getting away from the truth, the share price is absolutely shot. I won't be selling though and for my sins added substantially over the last few weeks. Let's just see what hits first 80p or £3.00 shall we?

[my retirement fund] 02/2/2016 22:57

This link tells you all you need to know if you care to sprinkle in a little common sense.

China are dumping cheap steel on other countries because they have so much overcapacity, because they no longer have so much internal infrastructure projects.

Thus steel producers cutting jobs or closing up shop in other countries - including the uk.

If China are going to soak up ore, its got to be exported so many other countries wont need to make it.

What could restore some near term balance is miners cutting ore production/closing mines and just focusing on the lowest cost sources strategically nearest China and no other. That's especially tough for South America.

Chinas actions show clearly they want to increase exportation of primary product, perhaps once their car producing capacity and military hardware producing capacity matures a little and, some primary product inflation may re-surface.

[essentialinvestor] 02/2/2016 22:00

Looking at the recent RIO statement, coupled with selling record IO production
in 2015 they have all but exhausted their Iron Ore stock piles.
What may be happening is smallER domestic Chinese producers
are folding/mothballing cutting off some supply.

[aleman] 02/2/2016 21:13

Chinese demand has gone? Where is your evidence?

I posted this 3 weeks ago amongst other links. China imported record amounts of iron ore in December so the full year finished with a rise. The annual amount for copper ore and concentrates was a new high after a surge, too. Forecasts for this year (on specialist mining sites) were down for 2016 but have now turned mixed.



The handwringing is because there is a lot of distortion of the facts in the media reporting. I might be wrong that the turning point is near but I'd prefer to be wrong because I made a mistake rather than acting on ill-researched media pieces that spout guff. If I've made a mistake, I should be able to spot it with a little help. I post such comments and links on ADVFN to see if any one can counter my thoughts with good reasoning and links to the evidence they base it on. If they can convince me I'm wrong on some aspect, I will review my investment. I want you to try convince me I'm wrong. It helps me filter out my mistakes. I've sold enough investments in the past thanks to constructive criticism. Just coming on here and continually saying this has a lot further to go when the share price falls some does not help anyone.

[my retirement fund] 02/2/2016 20:28

The great Chinese construction boom of the last 20 years has tailed off, all the super massive bridges, high speed railways, docks, airports, public buildings etc they are all done, there is only so much reconstruction a country needs to achieve a developed infrastructure. Sure theres ongoing bits and bobs like nuclear power stations to replace coal etc but its now all comparably very pedestrian consumption wise to what was.

There is always other developing countries however all the large ones like India/Brazil etc all look like long term basket cases stood next to China, none of which even remotely have the political system and leadership structure that's required to repeat Chinas great feat.

[rcturner2] 02/2/2016 19:54

Aleman, to a large extent this daily handwringing about metal prices is irrelevant, the only thing that matters is what will the global consumption of resources be in 12-24 months time? Now, undoubtedly I am probably at the most bearish end of all predictions, but I do not think we are anywhere close to the bottom here. The demand created by the Chinese in the last 20 years has gone, and it will not be replaced. Until producers accept that and reduce their size, all bets are off.

[aleman] 02/2/2016 19:13

I see we had credit rating downgrades hitting miners today. The reaction seemed a bit harsh - Mining index down nearly 5%. Wasn't this to be expected?



The odd thing is that the agencies should choose to do this damage after several weeks of rising metals prices. Iron ore has been rising, like base and precious metals, and company results have been better than expected due to sharply falling cash production costs. There is the possiblity that the bottom was seven weeks ago but there seems to be reluctance to acknowledge that the rest of the world might be improving as the USA wilts. It brings back memories of 2008, when the media commentators indicated China had worse to come but it actually picked up before anywhere else. Funnily emough, that was a US election year, too.



Helped by the weaker Australian dollar, Fortescue Metals Group, the world’s fourth largest iron ore exporter, last week said it has reached its cost reduction target six months earlier than planned. Cash production cost – excluding non-cash costs like assets depreciation – has fallen to US$15.8 a tonne in last year’s fourth quarter from US$25.9 in last year’s first quarter and US$35 in the first quarter of 2014.

Iron ore for Feb delivery is a litle over £43, about 12 % up December's early delivery lows. We don't seem to be getting much reporting of improving prices, even if it does turn out to be only temporary.

[pvb] 02/2/2016 18:18

I'll be going back on filter,

hmmm....but yet in the meantime you ask a question and expect me to provide you with a sensible reply?

It's beginning to sound like The Great Global Warming Swindle thread. ;-)

Sorry! I'll get me coat.

[aleman] 02/2/2016 10:35

BRWM is not like the RBA Index. THe index has 13% softs and 55% iron ore and coal and is around 10% PMs and copper. BRWM was 49% base metals, PMs and diamonds at the last portfilio update. and there could be more in the 37% diversifieds. Movement since the last announcement probably takes BMs, PMs and diamonds comfortably over 50% as they are generally up a bit since then. Of course this overlooks the problems of invested companies that have taken on too much debt and capex commitments, so share prices don't ncessarily follow their main metals prices, but BRWM's exposures would probably be a lot worse if it were as generalised as some of the commodities indices.

NAV has risen 10% from the January 182.10p low, reaching 200.00p yesterday. Rising gold and base metals in recent weeks seems to be feeding through a bit. I'm not saying it's the end of the falls or anything like that - just noting that the shares are only about 3% above their closing low so the shares don't seem to have kept up with recent rises in NAV. It looks like RC may heve been right that the low would not be seen until the discount blew out some more. It has however, increased recently by NAV rising while the shares stayed put. It is a bit of a chnage but will it continue and does it indicate a new trend? I'd suggest the sell-offs are getting more specific to individual company news and shares in some areas that were a biit oversold are recovering somewhat. Perhaps, shares in the collective funds have not recognised it yet.

[essentialinvestor] 02/2/2016 09:42

Surprised IO is where it is, thought we would be mid $30's now.

[kiwi2007] 02/2/2016 09:37

Feb. 1, 2016, 2:05 AM - The latest commodity price index from the Reserve Bank of Australia fell by 2.9% in special drawing rights terms (SDR), largely in response to weakness in iron ore and oil prices.



The chart in today's article (above) gives me little confidence in medium term commodity price rises.

[aleman] 02/2/2016 08:14

Base metals up again. Aluminium 4-month high. Zinc 3-month high. Copper now same as two months ago after jumping 2 cents. Trend seems to be strengthening. Starting to look like a gentle uptrend as $ weakens but that might be only temporary.

[fabius1] 02/2/2016 00:09

EI - RRS Not out of sight yet. PAF pays a dividend.

[aleman] 01/2/2016 21:18

Tenses? Are going? Will be going? Allowing a bit of time to respond looks like it was not worth it. You now are going back on filter.