"The history of Eureka lies in its future." - Lambert Molinelli, 1878


The author/editor of the Eureka Miner owns common shares of local mining stocks, General Moly (GMO) and Newmont Mining (NEM); together with benchmark miner Freeport-McMoRan (FCX). Please do your own research, markets can turn on you faster than a feral cat.

Sunday, May 10, 2009

The Eureka Miner's Million Dollar Grubstake

2010 UPDATE: Changes to the Eureka Miner Grubstake for 2010
Thompson Creek Metals (TC) replaces Nucor (NUE) 01-05-2010
US Gold (UXG) replaces ConocoPhilips (COP) 01-12-2010
2011 UPDATE: Changes to the Eureka Miner Grubstake for 2011
Quadra FNX Mining Ltd. (TSX:QUX) replaces EOG Resources Inc. (EOG) 05-29-2011
Sell 384 shares of Caterpillar (CAT) + cash to purchase 50,000 shares of Timberline Resources Corp. (TLR) 07-13-2011

Morning Miners!

What if the ole Colonel gave you a million dollar grubstake to invest in the future of mining in Eureka County? Pardner, wait no longer your greenbacks are in the buckboard!

Eureka's commodity sensitive economy finds itself at the crossroads of global recovery, somewhere near the intersection of gold and molybdenum. Since late March this report has tried to measure the progress of this recovery by looking at stock and commodity markets, commodity sensitive currencies and most recently, the quarterly reports (1Q09) of our major mining interests. Things are not great but we may very well be coming off a bottom and headed for happier days.

I got to thinking this weekend that it would be fun to put twelve stocks in a Eureka Miner's Million Dollar Grubstake portfolio. Five are directly related to the future of Eureka County mining; the remainder are related to domestic and global recovery. We'll start out with $1,000,000 and see how our fortunes grow (or shrink) in the coming months. The Report will periodically update the portfolio which should be a pretty good leading indicator for local recovery. If we get rich, Yee-ha! If we go broke, head for shelter in the new Firehouse!

Here's how we're spending all those greenbacks in the buckboard:

Stocks Related Directly to the Future of Eureka County Mining:

Barrick (ABX) - Gold mining
Newmont (NEM) - Gold Mining
General Moly (Eureka Moly, LLC) (GMO) - Molybdenum mining
ArcelorMittal (MT) - International steel producer, investor in General Moly
POSCO (PKX) - South Korean integrated steel producer, investor in Mt. Hope Project (Eureka Moly, LLC)

Stocks Related to Domestic & Global Recovery:

Gold exchange traded fund (ETF) (GLD) - Gold investment fund
Silver ETF (SLV) - Silver investment fund
Caterpillar (CAT) - Global supplier of mining equipment
Freeport McMoran (FCX) - A bellwether mining stock spanning gold, copper & molybdenum
Nucor (NUE) - Domestic steel manufacturing
EOG Resources (EOG) - Domestic oil & gas producer
Conoco Phillips (COP) - International integrated energy company

Closing prices for Friday, 5/8/2009:

ABX - $34.04 2,448 shares
NEM - $43.78 1.903 shares
GMO - $1.84 45,290 shares
MT - $28.70 2,904 shares
PKX - $89.00 936 shares
GLD - $89.98 1,084 shares
SLV - $13.79 6,043 shares
CAT - $39.64 2,102 shares
FCX - $51.80 1,609 shares
NUE - $43.59 1,902 shares
EOG - $76.87 1,084 shares
COP - $46.91 1,776 shares

Eureka Miner Grubstake value as of Friday, 5/8/2009: $1,000,000, Look for updates in the right column of this blog.

Enough rolling in the dough, let's walk the walk:

Oil is down $1.06 in early morning trading trading at $57.57(June contract). Gold is down $1.9 to $913.0 (June contract); Silver is down $0.100 to $13.855; Copper is down 0.0715 at $2.0745 (July contract); Molybdenum sits at $9.25.

The DOW is down 137 points to 8437.25; the S&P 500, down 19.69 points to 909.54. Miners are lousy today:

Barrick (ABX) $33.49 down 1.62%
Newmont (NEM) $43.05 down 1.67%
General Moly (Eureka Moly, LLC) (GMO) $1.75 down 4.89%
Freeport McMoran (FCX) $49.91 down 3.65% (a bellwether mining stock spanning gold, copper & molybdenum)

Steel stocks are not so hot(a "tell" for General Moly):

Nucor (NUE) $42.50 down 2.50% - domestic steel manufacturing
ArcelorMittal (MT) $27.93 down 2.68% - global steel producer
POSCO (PKX) $89.19 down 3.16%- South Korean integrated steel producer

The Eureka Miner's Grubstake Portfolio is down 2.42%


Colonel Possum

Image of old gold miner from http://culturemaking.typepad.com

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