Can't see this Email? View it in your Browser
 
Home | About | Video | Contact    

 

Try Making an Electric Vehicle (EV) without Copper or Graphite
 
 

TSX-V: NGC 
http://www.northerngraphite.com/
Northern's Bissett Creek graphite deposit is located in the southern part of Canada with easy access to labor, natural gas, equipment and supplies, ports and markets.  Bissett Creek is an advanced stage project with a full Feasibility Study and a Preliminary Economic Assessment which contemplates doubling production after three years of operation.  Permitting is well advanced and the Company is in a position to make a construction decision subject to financing.  The Company believes Bissett Creek has the highest margin, best flake size distribution and lowest marketing risk of any new graphite project, and has the added advantages of low capital costs and a realistic production level relative to the size of the market.
 

TSX-V: PGZ
https://www.panglobalresources.com/

Pan Global Resources Inc. is a Vancouver based junior resource company actively engaged in base and precious metal exploration in Spain.
 Pan Global's Board of Directors and Leadership Team bring decades of knowledge and global exploration experience to the Company.  The team has led their respective organizations to successful exit strategies or into production, generating hundreds of millions in shareholder value. ​
 

From the desk of Sherman Dahl, Pretium Group 
Comments from Sherman for the Week 

 
Good Morning Fellow investors, it is a bright and sunny day in Vernon, BC.  

It is a beautiful day in this neighborhood. 

Below are the weekly notes from Raymond James - which are always good to review. 

Built into my notes for this week is the clear message that Pan Global Resources is our top pick for Copper.  
 
There are tremendous amounts of research notes coming out this week on the fundamentals of copper and investors should know that this is a very interesting time to be investing in copper and copper stocks. 
 
You must be aware that you can today, invest and benefit from a low copper price and if you buy a well-run and undervalued copper stock, you will "double dip",  as the price of copper rises and the stock that you bought is also correctly valued from the time you bought it.  
 
So, even if you just by copper futures you will be "golden".  And that is what you should do if you don't know how to pick an undervalued copper stock. 
 
There are ways to find great companies with great projects, run by incredible people and can be purchased at very good prices. 
 
 If you can get all three working in your favour, and you are patient, the sun will shine on you. 
 
At the bottom of my notes, you will see an emphasis on the "people", described within my discussion with Tookie Angus. 
 
Let's just enhance that right now.  
 
Do not invest in stocks or deals run by people that have not demonstrated a commitment to shareholders and real projects. Just say no. Just like you should to all defilements of the mind that are offered up to you throughout the day. 
 
People that engage in tomfoolery and bad behaviour will have bad results.  Bad behaviour has many elements and can be easily seen in the actions of the CEO.  He or she will print paper for him/herself, they will do deals on projects that are often questionable, and then quickly spend all the treasury on about anything but exploration in the poorly structured company. Yikes.
  
I do a ton of work with Doug Johnson at Pathfinder and we speak daily, he would quickly and with very humorous sarcasm say, "get me some of that!".   
 
Doug, like Tookie Angus can no longer be fooled and they only invest in real deals with capable people with great reputations. 
 
Those that have bad reputations and treat shareholders poorly will see a very well displayed image at the front doors of Pathfinder that say, "go away". 
 
Well, lucky for you, let me let you in on a secret that has been uncovered for you: 
 
I did a few calls with CEO, Tim Moody this week, which further enhanced my understanding of the progress they have had recently in Spain. 
 

Listen carefully investors: 


 
PS     
Here is what you need to do. 
 
Buy Pan Global. Put it in your TFSA and be patient. Put in all your accounts and be patient. You do not need to do anything else. What a wonderful world! 
 
I had a wonderful long talk with Tookie Angus yesterday, what a treat.  
 
He reminded me of the absolute simplicity of this business when you deal with first class people that refuse to take short cuts or engage in tom foolery.  
 
You make money, and they do all the work.  
 
And all you really must do is avoid anybody that does not have a reputation like Tookie Angus, Patrick Downey, Tim Moody and the many others that you can become partners with by pressing BUY on your computer screen and letting them do the rest.  
 
And it is not hard to sort out the good from the bad once you have been around as long as Tookie Angus. 
 
I was inspired by his wonderful teaching way as we remembered our old friend Todd Peever and talked about doing business with first class people that inspire us both.  
 

"Sherm, this is the absolute best business in the world" 
 
Tookie Angus, Nov 27, 2020 

"Our favourite copper play is in Legacy Aggressive Growth, named Pan Global. Their main property in Spain not only has revealed high grade, near surface copper showings that remain open in most directions, but Gruppo Mexico, Atalaya Mining and First Quantum have producing mines mere kilometers away." 
  

“My kids found a picture of me from 1983 with Eddie Van Halen, and I thought, what a cool life I’ve lived.” – Michael J. Fox, Burnaby native
 
The TSX Composite rose 2.2% as the S&P 500 gained 2.3%.
 
It’s amazing what a few COVID-19-fighting medical breakthroughs and elections clarity can do for markets. Clients will be pleasantly surprised at their November statements.
 
 

It’s ok, they can’t all be awesome

 
Another week, another vaccine test result. AstraZenica/Oxford University announced a 70-90% efficacy rate for their experimental vaccine candidate, though the true number is unknown in part because they later revealed dosage inconsistencies and disclosure irregularities.
They developed a more conventional vaccine, one that would be far cheaper than the mRNA vaccines developed by Pfizer and Moderna because it can be stored in an ordinary fridge.
 
But experts point out that the disclosure problems hurt confidence in the results, giving the two mRNA American vaccines a competitive edge. It’s unfortunate, but let’s not forget how rushed these development projects have been.
 
Chances are the U.S. will start using the Pfizer vaccine within three weeks, starting with front-line workers. The world economy needs a solution, as witnessed by Europe’s purchasing managers’ index (PMI) falling from 50 in October to 45.1 last month (a reading below 50 indicates economic contraction) while Canada’s slipped slightly from 55.6 to 55.5.
 
U.S. PMI for November continued its rise powerfully but the jobless increases these past two weeks remind us that COVID-19 continues to pester what has otherwise been a powerful recovery.  
 

What are “hard assets”? Stuff you can kick

 
There is a reasonable argument to be made that the central bank and government stimulus meted out to fight the negative economic effects of the pandemic will, but when the pandemic barriers eventually get lifted, it will cause inflation. Liberty Media Chairman John Malone, a savvy investor, recently told CNBC, “I’ve got to believe this will lead to devaluation of currencies, that hard assets…will increase in value in currency terms. I’m not sure I’m going to call this inflation, but it’ll look and feel like inflation.”
 
While gold prices have been lackluster after the summer’s excitement, not all mined metals are doing poorly. Dr. Copper, an economic bellwether, has been on fire:
 
Our favourite copper play is in Legacy Aggressive Growth, named Pan Global. Their main property in Spain not only has revealed high grade, near surface copper showings that remain open in most directions, but Gruppo Mexico, Atalaya Mining and First Quantum have producing mines mere kilometers away.
 

Is the EV stock market craze a bubble? Not to those chasing them


Electric car companies exhibited some of the most bubble-like behavior this week that we recall seeing. Not only did a Tesla hit new highs, but EV stocks like Fisker (FSR), Plug Power (PLUG), and Ballard Power (BLDP) soared. Some of the most ridiculous moves we’ve seen were CIIC and SBE, which were SPACs that announced deals. Even Fisker (FSR), which faces fraud concerns, mustered a rally.
 
While these moves appear excessive and even irrational, it inspired us to buy a SPAC called Northern Genesis for several Legacy portfolios. As a reminder, SPACs, or special purpose acquisition company, are pools of cash raised by a management team that then goes shopping for an asset. If management knows what it is doing, it can be quite lucrative.
 
Our logic was pretty simple: we were able to spend $1 to buy 90 cents worth of cash in the bank (they have a war chest of $320 million), an extremely competent management team - including the former CEO of Algonquin Power, who grew the company over 8 times from 2008 to when he left earlier this year – and reports by Bloomberg that they’ve been negotiating vending in a Quebec-based EV bus company named Lion Electric.
 
If the deal fails to materialize, our investment will be backstopped by all that cash in the bank. If a deal does get announced, we think the stock in this current environment would go ballistic. It’s an excellent risk-reward investment. And if this deal fails to materialize, we know that they will eventually find another investment.
 
What kind exactly? We don’t know exactly but they have stated clearly that it would be a green industry. And with Biden winning and appointing John Kerry as special envoy for climate, green investments themes are hotter than ever.

Noteworthy links:
-          Alaska’s controversial Pebble Mine fails to win critical permit, likely killing it
-          Dry ice (solid carbon dioxide) is hotter than eve thanks to pent-up vaccine demand
-          National Rifle Association reports alleged misspending by current and former executives to IRS
-          GM stops backing Trump administration in emissions fight with California
-          Michael J. Fox talks about life
-          5 mental habits sabotaging your happiness
-          Diego Maradona, the most human of immortals
-          100 notable books of 2020
-          Photos of the week
 

Which battery mineral requires the largest production increase to meet future EV demand?

Musings Beyond the Markets 


Challenging conventional wisdom is difficult. It’s especially hard when the challenge is totally counterintuitive, and the belief widely and long held.
 
One such assumption that most of us hold and few of us have ever questioned is the effectiveness of television and online advertising. If it didn’t work, why would the world spend over $1 trillion a year on it and why are Facebook and Google – which derives almost the entirety of its revenue from selling advertising – be so wildly successful?
 
It turns out that there is quite a lot of evidence that the efficacy of such advertising is nowhere near as effective as the advertisers would have us believe. Not even close.
 
For example, eBay once spent $1 billion on annual advertising and decided to run experiments and studies into how effective their ad spending was. They previously believed that a dollar spent yielded $1.50 in return. But as their in-house economic researchers found, the number was closer to -$0.60 cents. In other words, they spent $1 to get 40 cents back.
 
Procter and Gamble, which has a huge advertising budget, experimented with cutting its advertising budget by $200 million to see what effect it might have on sales. As far as they could tell, it had no adverse effect at all.
 
All of this has been illustrated by the provocative cow tippers at Freakonomics, in their podcasts titled “Does Advertising Actually Work?”, part 1 and part 2. It’s well worth any advertiser, consumer, and investor’s time.
 
If advertising isn’t nearly as effective as the world assumes and advertisers assure us, what might happen to the long-term revenues and profitability of Facebook and Google if ad ineffectiveness where to become more widely believed? And how much more profitable would big-spending companies be if they instead decided to curtail some of that apparently wasteful spending?
 
A lot more independent research is needed. But growing evidence suggest that sanctimonious executives like Mark Zuckerberg may be selling the world a whole lot of snake-oil. 

 

Word of the Week

prepotent (adj.) – greater than others in power or influence. “No prepotent man will insult other people for two consecutive seasons.” – Japanese proverb



Seth Allen | Raymond James Ltd.
Senior Vice President & Portfolio Manager
T:604-659-8051 | TF:1-877-659-8057 | F: 604-659-8046
#2100, 925 West Georgia Street | Vancouver, B.C. | V6C 3L2
seth.allen@raymondjames.ca
Sherman Dahl, Pretium Capital 

Pretium Capital General Use Disclaimer
Pretium Capital, its owners & operators, content creators, presenters & interviewees offer no financial or investment advice. The content in this material is for information purposes only and is not an offer or solicitation for the sale of any financial product or service. Investors should seek financial advice regarding the suitability of any investment strategy based on their objectives, financial situation, investment horizon, and their particular needs from a registered financial advisor. Pretium Capital is not a registered securities or investment dealer. 
 
 
Website
Facebook
Email
 
Copyright © 2020 Pretium group, All rights reserved.
 
 
 
 
Vancouver, BC, Canada. Tel 1-877-484-3800
Don't want to receive email Updates? Unsubscribe me from this list
 

Â