Thursday, September 10, 2009
CAT Adds Another Hat, GMO Breaks $3.00
It is 5:48 AM and the ole Colonel is making a new pot. The first passed quickly when the break room was filled with gold experts earlier this morning. It's amazing how $1000 gold brings'em out of the wood work. Alan Greenspan was even here in a new pair of Raine's Wranglers and an oversize Resistol. I think they're all headed out to Barrick for a mine tour. We'll close on that in a moment, check this out first buckaroos.
For those of you that wear the CAT hat or carry a fondness for the old timer International Harvester trucks, there is some breaking news for you this morning. Although the deal has been in the works for some time, Caterpillar and Navistar just announced that they closed a joint venture transaction resulting in a new company, NC2 Global LLC (see note 1 below). It will serve the global commercial truck market and establish its headquarters in the Chicago area. Here is the press release:
NC2 Global LLC Press Release (09/10/09)
I can't think of a better example of two companies that "get it" when it comes to America's rightful and proud tire tracks in the global economy. Let's give them a Colonel Yee-ha!
Back to the world of gold which is certainly the buzz this week. Both gold and silver stumbled on the London spot market this morning but have recovered since. The yeller stuff dipped below $985 and then returned to $990; well below the $1000 mark but some profit taking is to be expected given the recent rally. The Colonel is sticking with his prediction of $1050 before Christmas. Silver followed gold to test $16.10 before bouncing back to $16.40. It will take a few days to see where we go next on precious metals. Not surprisingly the greenback reached new 52-week lows yesterday and I used that opportunity to buy more dollars through the Exchange Traded Fund UUP (someone needs to swim upstream, water wings advised).
After halting trading on two exchanges yesterday, Barrick is back on its feet nicely since its de-hedging announcement (Barrick Makes Bold Move, Moly Drops).
General Moly is screaming this morning jumping more than 9% to break $3.00. The intraday high is $3.15 so far. That deserves another Colonel Yee-ha!
Unfortunately molybdenum took another leg down to $15.10 and copper continues to struggle below $3. Metals don't lie buckaroos, I'd feel a whole lot better if these canaries would start flying north again. Here's a one month chart of our two little birdies in the global recovery mineshaft:
OK. Let's clear the decks and see what Alan Geenspan has to say about gold and currencies. Yeah, he probably did help crater the global economy but he was our monetary grandpa for all those years. If you want to ditch the link and show that old pa-pa how to wear a hat, I'm not tellin':
Gold Rally Signals Move Away From Currencies, Greenspan Says (Bloomberg, 9/9/09)
Let's skip the mine tour and walk the walk:
CAUTION: 4-WD ON, Off-Road Market Conditions Ahead
Yellow light on for declining molybdenum price (less than magic number: $16.50)
Yellow light on for possible adverse legislation (mercury emissions)
Otherwise, all lights are green on the Eureka Outlook Dashboard (upper right, what's this?)
Oil is up $0.61 in early trading to $71.92 (October contract); Gold is down $4.7 to $992.4(December contract, most active); Silver is down $0.055 to $16.415 (December contract); Copper is up $0.0650 to $2.8590 (December contract); Molybdenum drops to $15.10.
The DOW is up 20.33 points to 9567.55; the S&P 500, up 2.18 points to 1035.55. The miners are rocking:
Barrick (ABX) $37.45 up 1.35%
Newmont (NEM) $46.11 up 2.74%
General Moly (Eureka Moly, LLC) (GMO) $3.14 up 9.03%
Freeport McMoran (FCX) $67.96 up 0.41% (a bellwether mining stock spanning gold, copper & molybdenum)
Steel stocks are dancing too, (a "tell" for General Moly):
Nucor (NUE) $46.03 up 0.88% - domestic steel manufacturing
ArcelorMittal (MT) $37.94 up 0.15% - global steel producer
POSCO (PKX) $97.44 up 2.22% - South Korean integrated steel producer
The Eureka Miner's Grubstake Portfolio is up 1.85% to $1,177,020.05(what is this?).
Headline Photograph by Mariana Titus
Note 1 - In 1986 Harvester changed the corporate name to Navistar International Corporation (Harvester had sold the International Harvester name and the IH symbol to Tenneco Inc. as part of the sale of its Ag division). Navistar International Corporation continues to manufacture medium- and heavy-duty trucks, school buses, and engines under the International brand name. (Wikipedia)