Sort of sad mining joke

Junior gold stocks are depressed and the companies are having trouble raising equity capital. One CEO asked recently, "What is the difference between a large pizza and a mining geologist?" Answer: "The pizza can feed a family of four."

Junior Oil Co.: Hyperion Exp. Corp: TSX-V: HYX

We attended an interesting presentation by a Canadian oil exploration company that is active in the Cardium area of Alberta. Their strategy is to develop production by purchasing producing acreage and then applying horizontal drilling and fracturing to building up production. This very conservative strategy has been applied with success by the CEO Trevor Spagrud at previous companies. It is interesting that that, contrary to previous experience, stock market valuation for the company is not rising along with production. which makes new equity financing difficult. Today's market constitutes and anomaly, and perhaps an opportunity, assuming of course that market conditions will return to normal eventually. We shall see.

Gold mining company wave of consolidation?

The Financial Times suggests yes today, p. 18. http://digital.olivesoftware.com/OLIVE/ODE/FTUS/Default.aspx?href=FIT%2F2012%2F04%2F30&pageno=18&entity=Ar01803&view=entity

A Sunday Thought

Sometimes we learn surprising things about people long after their deaths. In 2009, The Times first published the following lines by TS Eliot:, who passed away in 1965. "Of all the beasts that God allows/ In England's green and pleasant land/ I most of all dislike the cows:/ Their ways I do not understand." How many of us, like Eliot, go through life without resolving such inner torments, and how better our lives would be if we did! It's worth thinking about.

The fracturing of shale formations holds the promise of almost free energy for the entire world. This may well (no pun intended) be the most important economic development of the next fifty years. Here are some implications: 1. Accelerating economic growth 2. Shrinking of the oil and gas industry (revenues shrink, like with mainframe industry thirty years ago) obsolescence of utility companies. (power generated at home level; more efficient) 3. No more coal 4. No alternative energy industry 5. Disruptive politics as industries and interests negatively affected engage in a bitter but futile resistance. 6. Middle East becomes unimportant and Canadians focus more on maple syrup production. In short, the future lies before us.

The center cannot hold. . .

In a way we are lucky that Obama was elected in 2008. His leftish (sort of) approach hasn't proved to be a panacea, so we has received a homeopathic inoculation that will protect us to a degree from radical solutions, whether or not the president is reelected. The cynicism of the American public is such that untoward enthusiasms are unlikely. This is not the case in Europe, where it is the conservative approach that has been called into question by a public anxious for rapid solutions to long-term demographic and structural problems, whether the formula comes from the the left or right. I just finished reading the Economist's special section on Cuba. They have achieved a sort of stability under Castro where a lack or economic growth combines with good social statistics. Castro is the Lee Kwan Yew of poverty, but the social outcomes have been similar, putting aside the relatively fewer numbers of automobiles and ipads in Cuba compared to Singapore. The business models of Europe and the US are broken and need to be changed. I suppose that this means that Europe moves to the left for a solution and the US will probably move to the right, at least for now.

NATO war crimes

One of the Qaddafi sons, age 29, and three grandchildren, all under 12, were killed today in a NATO air strike that was clearly targeting a civilian residence. This is a war crime under the Geneva Convention.