We were downtown for financing discussions for an overseas exploration program. I have never seen our financing partner so despondent. He was just beside himself with despair. He had originally started off with JPM, moved to Merril Lynch before starting his own merchant bank. They're all going under. He said that without strong Fed activity JPM would have already been gone along with Bear Stearns and numerous other brokerages, including two significant Canadian ones. If you own stocks you should seriously consider Jim Sinclair's advice and take delivery of your certificates.
The gravy train won't last forever. The smart money is now starting to cash out. Don't count on the dividends of the past. Paper promises are so last century. The future is in tangible goods.
If you're inclined to remain in the stock market at all, it's an absolute necessity to take delivery of your own stock certificates. Otherwise, it's like loading cargo on to a ship that's already sinking. When Chase, Merrill and the others slip beneath the waves never to resurface again, you become just another creditor who may get several cents on the dollar for your portfolio since it wasn't held in your name, but theirs. Not to mention the years that it may take to settle your claim to their remaining paltry assets.
Here in Wisconsin, we have some of the highest property and gasoline taxes in the US. We're squeezed so much, I have to make my daughter wear penny boxes for shoes. At least she has an endless supply.
I was implying with the junior sector with firms that have no current cash flow but with a high IRR mine in the bankable FS. I have yet to see a financing deal in a project go ahead in the junior sector since the first of the year and most of the sources of funds of those projects that got the financing go ahead in the past year have come from Europe. Cost overruns in building a mine are rampant and that is another big contributing factor to their reluctance.
Lots of depression in stock broker land
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Posted - 04/08/2008 : 21:16:21
