NOTHING GOLD CAN STAY

NOTHING GOLD CAN STAY

Nature's first green is gold,

Her hardest hue to hold.

Her early leaf's a flower;

But only so an hour.

Then leaf subsides to leaf.

So Eden sank to grief,

So dawn goes down to day.

Nothing gold can stay. 

Robert Frost

It's that time of year again where this Frost poem is so apt.  As the new foliage sprouts, its hue is a yellow-green before the deeper green takes hold.  The aspens on the prairies will soon take on that first green as gold.

Links for Junior Gold

Sunridge Gold
Proactive Investors (2010 November 2)
Resource Clips (2011 April 29)
Comprehensive Byron Capital Report (2011 May 6)

Everton Gold
Midas Letter (2010 March 8)
321 Gold (Excellent site 2010 May 4)

Ethiopian Potash
Could potash go to $750?

Another crash and where to hide?

Peter Grandich published a cautionary posting today.  Equinox is being courted by Barrick in a friendly takeover bid.  What to do?  Well, I think I better keep the chart for Equinox in mind when making the right moves before QE2 ends and the *#&% hits the fan.

EQN took a huge hit during the financial meltdown of 2008 and is now at record highs almost 3 years later.  BEWARE JUNIOR RESOURCE STOCK BUYERS!

The importance of proper pedagogy to develop effective student practice

Yesterday, my elder son was having trouble with a passage with 16th notes on the piano.  My perceptive wife finally figured out what was wrong - his finger position was poor.  She had asked about this with his first piano teacher and she just said it would work its way out as he got older.  Well, when we switched to his current piano teacher (an experienced teacher who pays attention to details), she immediately said he needs to curve his fingers properly.  This was something my wife had asked his first piano teacher to address to no avail. It kind of reminds me of the Madame Marika song that my younger son is learning about in his Yamaha Music Wonderland course "fingers curved like a spider".   The problem is - bad habits are hard to break.  I know this from typing.  I always shift with my left pinky and I've not been able to break this bad habit.  With teaching students keyboarding, I've given up on trying to break bad habits given my personal experience!

Furthermore, my wife noted that our elder son has progressed rapidly with violin because his Suzuki violin teacher (Mr Kashap) demands proper technique before the student even plays a note.  This resonates with me because in The Talent Code, Daniel Coyne notes not all practice is effective.

I also disagree with Will Richardson's recent TED talk in which he lauds his daughter learning a song from YouTube.  True, she learned to play something, but did she learn to play it well?  I doubt it.  Now, I suppose it doesn't matter if you are just doing this for fun, but if you want to have some real progression, the guidance of a great teacher is paramount.  I also note that as one gets into more advanced study, it becomes harder to try to learn a subject with such superficial means.

I've always been skeptical that such learning is possible with subjects like mathematics and science.  For example, when I mentioned at an open house that "I'm the most focused when I'm programming a computer - I need to be fixated on the problem at hand", a member of the audience, a computer science professor, came up to me and said I hit it right on the nose and I was exactly right.  I recall one Friday night as a grad student how I had set about to program the Brysk-McCowan cylindrical slant stack.  After about 90 minutes of focused FORTRAN programming, I had successfully implemented the article from Geophysics into a working computer program. I surprised even myself.  Twitter, YouTube, Khan Academy etc may help one learn these 'left brain' subjects, but there is no replacement for old fashioned correct practice.

Brooksley Born - a lawyer with complete integrity

I was watching Inside Job again last night and was struck by Brooksley Born - the head of the Commodity Futures Trading Commission under Clinton's 2nd term.  She was interviewed by Frontline in 2009 and I was impressed with how seriously she took her job as a public servant.  This is quite unlike the other more famous characters who opposed her desire to regulate derivatives as far back as 1996.  Larry Summers, Alan Greenspan and  Robert Rubin all opposed her foresight.  I couldn't believe this glowing Newsweek piece on Summers.  It mentions his dismissal of Born almost as a positive!  Given Newsweek published that in March 2009 (after the 2008 meltdown), is it no wonder they're going broke when they put out junk like that?

Today, S&P downgraded the outlook on US debt.  Given that S&P rated sub-prime mortgage derivatives as AAA in collusion with the likes of Lehman, Bear Stearns and Goldman Sachs, who cares what they say even if it's actually more accurate now?

It is so sad that the Wall Street crooks got billions in bailouts and now the average citizen is paying for their astronomical greed.

A lot of numbers to keep in mind

Found this FP article which tries to look at what's behind the surge in commodity prices.  I always felt that part of QE2 was to devalue the US$ and that's been behind some of the strength in commodity prices.  Now, as the article says, is the rise in price due to a bull market in horses or a bear market in goats?

Also, Diane Francis had another insightful article about the state of sovereign debt in Canada.  For some eastern Canadian provinces, it is as bad as it is in the US.  The counter balance of commodity rich western provinces masks the national average.  I should follow Diane Francis as she had a nice article called China Cheats last month.

Now, I wonder about junior stock valuation.  I had thought Avion at $2 should be fully valued if we compare it to Kinross based upon their gold production.  Kinross is really taking a hit right now.  I gave up on Northern Dynasty and took a $1700 hit on that one (had taken a $900 hit on Kinross in March).  Now I'm break even again and waiting on Sunridge Gold and Ethiopian Potash to hit it big for me.  I also have Everton, Romios and Malbex in my RRSP.  Will one of them be a rocket like Continental Gold was last year?  I hope so.

Looming large is also the demographic time bomb and Andrew Coyne mentioned it again in Maclean's and on CBC At Issue Panel. Jonathan Chevreau also quoted Peter Grandich suggesting the era of the retirement pension entitlement is coming to an end.  Today, there was an FP article promoting RESPs.  Chevreau also had an easy plan to save $2000/year by saving $5/day. I figure if I can donate 10% of my gross pay, then anyone should be able to save $5/day.  Indeed, it takes just $1/day to sponsor a child in the third world.  So, the era of do-it-yourself finance is coming as government entitlements are ending.  Consequently, the Tory immigration plan of not allowing the sponsorship of elderly parents is VERY APPROPRIATE!  We can't afford to pay entitlements to elderly newcomers who have not paid a cent into the very entitlement they are receiving!

Gold hit an all time high again the past week.  However, it's still not at the $2500 inflation adjusted 1980 high (use this spreadsheet to work that out - I put in $850 and 3.5% and you'll get about $2500 at 31 years).  If you want to modify it, you'll have to download it to your computer.  I also remembered that when Canada switched to Metric in the mid-1970s, the gas price was $0.17/L in Edmonton.  Now, using that spreadsheet, I worked out that at 6% inflation/year over 35 years, the gas price would increase to $1.31/L (which is about what it is today).  I guess the price really hasn't gotten higher after all (factoring sort of reasonable inflation).  That doesn't fill the hole in my wallet though!

Annoyances - Windows 7

Microsoft is really going downhill.  It was patch Tuesday again this week.  Well, my Windows 7 Pro computer wouldn't boot after 20 new updates were applied.  This happened twice and I had to do a system restore back to the previous state twice.  Looks like others have had problems too. I don't understand how reviewers praise this piece of junk.  I get not responding message for anything from a browser to word processors quite often now.  VERY BAD SOFTWARE.  I'll have to turn off automatic updates so this doesn't happen a third time.  If only there was more software for Linux.  However, for the average user, I think Ubuntu is just fine.  Too bad more people don't know about that!

OK, noticed that Windows 7 Service Pack 1 was out. I turned off automatic updates in Control Panel.  Then I downloaded the DVD image for Win7 SP1.  Funny how the service pack is named as Windows 6.1 service pack (so Windows 7 is really Windows 6.1!)  Ran the service pack (takes about 1 hour).  Then I applied the latest Windows 7 updatess (minus IE 9).  It actually worked this time.  Just shows how shoddy the Windows updates can be.  I can imagine the average user puzzled that their computer wouldn't boot and taking it for service and forking over more $$$.  No wonder the IT industry loves Microsoft products - it keeps the food chain going!

Well, the computer wouldn't boot again, so did a system restore back to SP1 and turned off automatic update notifications.  See if this works.  What a bunch of crap Microsoft!

It still doesn't cold boot!  This is bad.

I upgraded the memory to 6 gig.  This appears to have fixed things.

Gold hits an all-time high

The crumbling Portuguese economy is probably one of the driving forces behind gold's rise today.  Good news for miners.  All these problems make me think of Pierre Berton's book 1967 - The Last Good Year. A family friend gave it to me years ago.  Peter Grandich said everyone should spend a couple of hours to watch the Inside Job.  I sure will. It was great that Amanda Lang came to the STA Convention last year. I found her talk quite alarming.  There are a lot of wrongs in this world.  The craziness of Wall Street and sovereign debt are among them.  I had seen a Financial Post article about the potential of sub-Saharan Africa for investment.  This is indeed true.  I was amazed that there are now mining prospects in Eritrea and Ethiopia - two formerly war-torn countries.  I've certainly been fortunate to cash in on the success of Continental Gold in Colombia.  What a change of events there too!  Didn't FARC release some captives just last year?  The only problem - and it's a big one - is how is the whole world suppose to sustain economic growth?  If the under-developed world wants what we enjoy, how can it continue?

I've decided to use some of my geophysics background to make some $$ from junior miners. Unfortunately, I never took electromagnetic methods because I was chicken and I figured I was only interested in seismology anyways.  Big mistake.  Although I think I can read IP profiles like the ones from Romios Gold, it would have been better to know the theory behind all those methods!

Beethoven night again

Yesterday night, I decided to pull out the DVD of Maurizio Pollini playing Beethoven's 3rd (Op 37) and 5th (Op 73) piano concerti.  Elisha promptly picked up a pencil to start conducting. He also went upstairs to get his violin and become part of the orchestra.  I've not been very motivated to exercise, so the visual of Pollini playing my favorite Beethoven piano concerto (Op 37) helped as I kept at it for the entire concerto.  Later, upstairs, we listened and watched von Karajan conduct the Pastorale symphony finale and the 5th and 9th symphony (last movement).  Our baby truly loves this and I think Beethoven is his favorite.  What a favorite to have - a genius of the highest order.

We often joke that Elisha's a "genius" because his violin teacher is so impressed with what he's accomplished since starting in September.  He's shown him off to his other students on Friday morning for the past two lessons (he can play the note that's on the flash card almost immediately).  He can still hardly believe that Elisha can really read notes that fast (since he first tested him on March 18).  He also keeps on asking how old he is (he thought he already turned 4, but he's still 3 years old).  At group lesson, he also plays by notes, not by fingering. 

Now why are Elisha and his older brother, Samuel, among his best violin students?  Well, Elisha is truly intrinsically motivated.  He actually practises about 40 minutes a day.  Yesterday, he even picked up his violin on his own and played his new piece Go Tell Aunt Rhodie.  His brother practises about 40 minutes a day as well as another 45 for piano.  There's no secret - what ever you put into what you do often determines what you get in return.

My grandmother's longevity

My grandmother, Yoneko, has recently lost her sight.  She is 95 years old.  Today, I found this article about he benefits of natto.  I remember as a child seeing my grandmother eat this soy bean food.  I didn't think it was too appetizing and never ate it.  My mother says most of the health problems we face are due to diet.  She points to my grandmother (my father's mother) as a case in point.  During this time of Lent, I think it is appropriate if we think about the problems that the largesse of our society poses to one's health.  I've read that the drugs that are used to treat various chronic conditions may actually be harmful.  I never liked the idea of taking a statin to control cholesterol.  Well, I think it's high time to look at some alternatives.  I've felt healthier and have been less sick this past winter as I've tried to do 30 minutes on the NordicTrak 3 times a week.  The lethargic technological society we have is really causing multiple problems.

Can it get any worse?

Well, the Mazda 2 wasn't even 4 days old when I got a flat tire on Thursday.  On Friday, I took it to Good Year and they said it couldn't be patched as the rim had cut into the side of the tire.  I suspect it was a pothole I hit on Main Street on the way to EHCI on Thursday.  So, I'm out another $250 and I have to wait until about April 3rd before the replacement tire comes in from Edmonton.  Very sad.  Stocks were down for me this week too.  I waiting on some junior miners to pick things up for me this year.  I gave up on Northern Dynasty in my RRSP to some of that.  I still have Northern Dynasty in my trading account, but I'm thinking of taking the loss there and moving on too.

And here is the answer to my question.  Yes, it can and will get much worse (as pointed out earlier by Maclean's in this article).  I heard on the CBC yesterday that the City of Regina is short funds for it's public workers' pension plan.