Gold und Silber... Informationen und Vermutungen I

Quote, Mahendra 1.Februar 2007:

Take a small short position on each day until 14 of February because no one can save them from a big crash after the 12 of February.
I feel that this will be one of the best predictions that I have ever made in the twenty five years of my predicting career.
The overall fall will be around 18 to 27 percent.

Ich erwarte die PM Action von 12 Februar bis 3. Maerz.

Diese Woche noch ein kleines Bulltrap Game.

Irgendeine news in den naechsten Tagen triggert dann den Markt.

Mal schaun...

Regards

Eldo

Bis jetzt nur ein Katz und Maus Spiel....

Fear and Greed drives the market.

Le Metropole Members,

Alf Field has served commentary at The Man Ray Table
titled, "MINING MANPOWER CRISIS."

"There is a manpower crisis in the form of a skilled
worker shortage that is having an adverse impact on
the mining industry. Whatever one is interested in, be
it gold, silver, platinum, uranium, base metals, or
other mining operations, this situation is impacting
on all forms of mining. It will influence the way
investors view mining companies. Current mining
operations will struggle to maintain production
while new projects will be delayed."

MINING MANPOWER CRISIS

By Alf Field

There is a manpower crisis in the form of a skilled worker shortage that is having an adverse impact on the mining industry. Whatever one is interested in, be it gold, silver, platinum, uranium, base metals, or other mining operations, this situation is impacting on all forms of mining. It will influence the way investors view mining companies. Current mining operations will struggle to maintain production while new projects will be delayed.

Most importantly, the skilled manpower crisis will slow the supply of newly mined metals to the market which will have implications for the prices of all metals.

To properly appreciate the situation one needs to understand that most metals, gold, silver, platinum, uranium, base metals and others have been in bear markets lasting 25, and in some cases 30, years. During those bear market years there was an attrition of skilled mining manpower. Young people looking for new careers carefully avoided the “No Go” areas of geology, mining engineering and other mining skills.

With declining student demand, Universities and colleges reduced or closed their geology and mining faculties. The supply of new graduates to the mining industry has been dropping steadily and there is now only a trickle of graduates coming through the system.

During the past few years new bull markets have developed simultaneously in gold, silver, platinum, uranium and base metals. These bull markets have spawned a vast array of new companies, all looking to find new large deposits of their favourite metal and bring new projects on stream. The demand for skilled workers in the mining industry has mushroomed.

Where will the additional skilled manpower come from? Not only to find and develop new projects, but also to keep existing mining operations producing adequately?

Increasingly the words “production declines due to labour and infrastructure shortages” are appearing in company reports. Delays in the preparation of Feasibility Studies are often being blamed on a “labour shortage”. There is an rising incidence of new projects being delayed and subjected to massively higher capital costs, for example BHP’s new Ravensthorpe Nickel mine where establishment costs have escalated from $1.1 billion to over $2.2 billion. There is no firm indication as to when Ravensthorpe will come on stream.

The average age of the existing complement of skilled mining manpower has been rising and there is a steady loss of people as they reach retirement age. Half the workers in the Canadian mining industry are between 40 and 54 years of age and 40% plan to retire in the next 8 years. The supply of new graduates barely covers the retiree loss.

Another form of attrition in the skilled mining area is the loss of geologists and mining engineers to the investment industry. The investment industry must deploy its research budgets in the most profitable and effective areas. In the 1970’s when resources were booming and mining stocks formed a large proportion of market capitalisation and volumes traded, stock brokers and investment houses carried large complements of mining analysts and mining merger and acquisition teams.

During the ensuing resources bear markets the trend in stock markets was towards industrial and technology stocks. Investment industry research budgets were deployed accordingly. Mining research was slashed and analysts skilled in the new hot areas were hired. By the turn of the century resources accounted for low single digit percentages in both market capitalisation and volumes traded on most stock markets. Mining analysts had become an endangered species.

With the emergence of firstly the bull market in precious metals followed more recently by bull markets in uranium and base metals, the situation has reversed. Mining’s share of volume traded and market capitalisation on world stock exchanges has been increasing steadily, as has merger and acquisition activity. The investment industry has been caught short of mining analysts and mining M&A teams.

Good mining analysts require special skills and they cannot be created quickly. The investment industry’s solution has been to hire geologists and engineers to work with financial analysts to produce the necessary resources research. Those geologists and engineers who have gone to work in the investment industry’s air-conditioned glass palaces are unlikely to want to get their hands dirty in the bush again. They are lost to the mining industry forever.

How long will the present shortage of skilled labour in the mining industry last? How long will it take for Universities to resuscitate their mining related faculties and generate an increased flow of graduates to the industry? The initial signs are not good. An Australian University located adjacent to a large mining area closed their geology and mining engineering departments many years ago and said that they had no intention of restarting these facilities. They did not want to get involved in a “boom and bust” situation again.

Those Universities with a more amenable attitude towards resuscitating their mining departments will find difficulty obtaining good teaching staff. When potential teaching candidates can earn several times what a Professor is paid by working in the mining industry, why would they want to go teaching? It will also take time to persuade new students to make mining their career after University mining faculties have been beefed up.

It will probably take several years to reach the point where sufficient Universities have increased their mining facilities to the point where they can attract an increasing flow of students. Then 4 to 5 years of study will be required for new students before an increased flow of skilled graduates is available to the mining industry.

A best case scenario would be 7 to 8 years before one could expect an increased flow of new mining graduates. A more realistic expectation would probably be 10 years.

The next decade looks as if it is going to be a period where mining companies will only be able to increase their skilled staff complement by pinching people from other companies. It is a zero sum game.

If the total skilled staff situation is going to be static, or possibly even declining, then the mining industry as a whole will struggle to maintain current levels of production and will simply not have the people available to get new projects underway.

Mining staff will gravitate to those companies where the rewards are greatest and where there are facilities for a good family life. Mining labour costs will naturally rise sharply.

During the next decade most analysts expect an increasing demand for metals of all kinds. There are differences of opinion as to the rate of demand growth that can be expected but whatever it is, the total supply of new metals to the market is going to be stagnant during this coming decade due to the skilled labour shortage. If this is the case, then shortages will inevitably develop in markets for different metals leading to higher prices.

The basic economic law that higher prices will generate new supply may have to be postponed for a decade or so in the mining industry and metal markets.

There are implications for investors in the mining industry that need to be studied. In the envisaged circumstance for the coming decade, will a premium develop for those companies that are already in production, or about to do so within the next few months, as they will benefit most from rising metal prices? Will companies with great development projects be downgraded because of likely substantial delays in bringing their projects to the production stage?

Is this the reason why the larger mergers and acquisitions in the mining industry in recent years have been for companies that are already in production?

Naturally those companies that have already recognised the coming problems in the supply of skilled labour and have built up good teams that are locked in with “golden handcuffs” will be deserving of an improved rating.

The situation will almost certainly be different from country to country and from continent to continent. Are there countries that are better placed than others to cope with this labour shortage situation?

It is almost impossible for an individual to assess this problem across such a vast array of territories. The beauty of the internet is that these articles are read in virtually all countries. I know this from the emails that I receive from time to time in response to my articles.

I share my views freely but for once I would like to make a special request of readers. I would greatly value input about the status of Universities in your country or area with relation to the production of new mining graduates. Is the situation in your country or area as grave as described in this article?

If you are in the mining industry, how do you view this problem and how are you coping with it? What action is the mining industry taking in your country or area to increase the supply of new skilled workers?

I will undertake to collate all responses received into a later article that will present the results of the comments that I receive.

Alf Field

5 February 2007

dau2006

Ich werde ein wenig Aktien und OS verkaufen um die 720 POG und 16 POS oder knapp bei HUI 390.
Das kann bis mitte Maerz passieren,danach kommt das Sommerloch bis September/Oktober.
Der Irankonflikt koennte was ausloesen, wer weiss ?
Mitte Juli faellt der USD dann langsam ab Richtung 81-82 USD/IDX IMO
Sicher ist sicher, I'm low on Cash :D...die Berliner sind auch schon weg.
Bis dort hin mache ich gar nichts und sitze es aus im Fall es geht runter.
Mein Einkaufswagen ist voll, jetzt heisst es nur mehr abwarten.

Was Paramount angeht da heisst es warten und halten, ich bin da auch zu frueh rein.

Solange ist sie noch nicht gelisted, ich habe das bei anderen oft gesehen da lief auch nichts ab bis sie dann gestiegen sind.
Ab in die Schublade, nicht gross hinschaun.

Schweizer Philosophie, wennst nicht weiss was du tun sollst, machst erstmal gar nichts.

Der Markt macht was er will, Emotionen der Anleger kann man nicht einschaetzen.

Erstmal Tauziehen bei 655 und 13.75.

Its a long time investment, just relax.......up ins Pub

Gruss

Eldo

Passt ja, der HUiiii kommt spaeter nach...

Deine 666 und dein Teufelbild bringen wieder Pech Baron, du kannst es nicht lassen.
Und schon gehts wieder runter.
Was dich an der Nummer so aufgeilt weiss ich auch nicht.