Saturday, July 22, 2017

Ukraine economy continues to improve

National Interest:


Most importantly, Ukraine is seeing signs of economic growth. Last year, GDP grew for the first time since the war started, at 2.3 percent. This year GDP is expected to grow 2 percent, and the World Bank expects 3.5 percent growth for 2018. Ukrainian exports of metals, iron ore and grain are on the rise as well.

The key driver of these macroeconomic improvements has been Ukraine’s adherence to the International Monetary Fund’s program for the country. In the beginning, many naysayers doubted Kyiv’s ability to meet the strict demands the IMF placed on it. Despite such rigid requirements, Ukraine is making good progress.

Ukraine is still a mess politically. However, things have gone from terrible to less terrible and this is what I look for when speculating in these frontier markets.

Ukraine has tremendous agricultural potential that is not fully tapped. Very large companies like Fairfax Financial based in Canada have begun taking positions in various Ukraine based agricultural firms like Astarta.

Thursday, July 20, 2017

Mongolian Sales Managers Index reflects continued growth in economy

World Economics:

Sales Growth Index backs off 4 year high

Business confidence continues to grow very rapidly

After years of contraction the jobs market shows signs of life

Tuesday, July 18, 2017

Buying two gold and silver miners for a trade

Yesterday I bought shares in Great Panther Resources (GPR.T) and Klondex Mines. I think gold and the gold shares have put in a bottom.

I do not see these stocks as investments. As always these stocks are like burining matches and should never be buy and hold vehicles. The setup is looking good for mining shares so the probabilities appear to be in my favor. I base this on the Commitment of Traders report.

From Clive Maund's recent commentary:

Friday, July 14, 2017

Air arrivals in Cambodia soar


Air traffic for Cambodia’s three international airports increased by 23 percent in the first six months of the year, driven largely by growing Chinese tourism and the increased number of international flights to Sihanoukville’s airport, a spokesman for the company that operates the Kingdom’s three international airports said yesterday.

Khek Norinda, communications director of Cambodia Airports, said passenger arrivals at airports in Phnom Penh, Siem Reap and Sihanoukville surged during the first six months of the year, increasing by 23 percent compared to the same period in 2016. Total passenger arrivals reached 4.2 million during the first semester, he said.

I am invested in Nagacorp which owns the Nagaworld casino and entertainment in downtown Phnom Pen. You can read my investment thesis on Nagacorp here. Speaking of Nagaworld they recently reported interim 2017 results. from the report:

1) Gross Gaming Revenue increased by 40% to US$386.8 million
2) EBITDA increased 19% to US$181.0 million
3) Net Profit increased by 20% to US$150.6 million

International arrivals to Cambodia, one of the Group’s business growth drivers, increased 13% to 2.3 million visitors in the first five months of 2017. Visitor arrivals via Phnom Penh International Airport grew 19% over the same period. Further, visitation from China grew by 36% to 0.4 million visitors, surpassing Vietnam to become the top source of arrivals to Cambodia (Source: Ministry of Tourism, Cambodia).

Cambodia continues to grow as tourist destination. It has now surpassed Vietnam as a destination for Chinese tourists which I think will be the main tourist cohort into the future. As tourist numbers grow in Cambodia a certain number of these people will find themselves in the NagaWorld casino spending money.

Wednesday, July 12, 2017

Egypt's economy is recovering

Middle East Eye:

Things are looking up for Egypt’s beleaguered economy. At least investors think so, which is why they are pouring money into the country. Analysts are optimistic also. The news must come as welcome relief for the country's residents who have suffered brutal inflation and soaring unemployment.


The good news on the reform front is that this year there is light at the end of what has been a dark economic tunnel. Growth is expected to reach 3.5 percent this year, according to a recent report from New York-based bank Brown Brothers Harriman (BBH). Meanwhile, inflation has dropped to 29.7 percent in May from April’s record. It is expected to drop to around 18 percent by year-end, according to IIF forecasts.


Perhaps the best news of all is that capital is starting to flow into the country. “Foreign investors have taken notice [of the economic reforms] with inflows picking up sharply,” states a recent report from BBH.

Things are beginning to change at the margin in Egypt. This is what happened in Pakistan and I ended up with a 45% gain. Not guaranteed it will happen in Egypt but the setup is very similar.

Uranium prices up for sixth straight week

Economic Calendar:

TradeTech’s weekly spot uranium price indicator climbed last week for the sixth consecutive session; however, the rise was very modest. Uranium spot prices advanced by just $0.05 to reach $20.25 per lb. The six-week rise has taken uranium prices up just $0.75.


In company news, Uranium One (TSE:UUU) confirmed that its subsidiary Mantra Tanzania has applied to suspend the Mkuju River project in Tanzania due to depressed uranium prices. Uranium One, an international mining company of Russian state nuclear energy corporation Rosatom, said its subsidiary Mantra Tanzania applied to suspend the project in December last year.

The request to suspend the project is purely a result of depressed uranium prices, according to the company. Commenting on the request, it said: “Mining in this depressed environment will have no benefit to the people of the United Republic of Tanzania, or the Company, as the project financials make it infeasible to commence such mining at current price levels.” 

Although up for six straight weeks the price has only advanced $.75/lb. so I am not getting to excited. Nevertheless, as the article mentioned another mine is shutting odwn taking more supply off the market. That is what we expect to see if the supply/demand balance is going to normalize.

Tuesday, July 11, 2017

Secret trader turned $55 million into $283 million with crypto currency trading in one month


An unknown cryptocurrency trader turned $55 million of paper wealth into $283 million in just over a month.

The only clue about this person or persons, beyond a virtual wallet with the identification code 0x00A651D43B6e209F5Ada45A35F92EFC0De3A5184, surfaced on a June 11 Instagram posting, in Bahasa, in which he or she (or they) (or somebody posing as them) boasted about the 413 percent profit accumulated earlier this year from ether, the digital money of the Ethereum blockchain.


Cryptocurrencies could become a $5 trillion industry, but they need to develop sound business principles to satisfy regulators and lend legitimacy, Novogratz said June 27 at a fintech conference in New York.

When I see articles like this I wonder if the crypto currency's are in a bubble. I sold my bitcoin a couple of months ago. I have subsequently began mining Bitcoin via Hashflare. I feel like I need to have a foot in the market for Bitcoin regardless whether it is in a bubble or not.

Sunday, July 9, 2017

Canacol Energy (CNE.T) hits another monster gas well in Colombia

Canacol Energy:


Mr. Mark Teare, Senior Vice President of Exploration at Canacol, commented “Toronja 1 marks another success in the new, high impact, shallow Porquero sandstone gas play that we tested last year with the Nelson 6 exploration well, with Toronja 1 successfully testing at a combined rate of 46 MMscfpd.

46 MMscfpd is equivalent to 8100 barrels of oil per day.  This is huge and is the 8 successful well of the nine recently drilled.

The issue with Canacol currently is the ability to take the gas to market. However the management has updated its ongoing plans regarding this issue.

...the SPV has acquired approximately 60% of the right of way for the flowline, and has purchased two parcels of  land for the compression stations.  Fabrication and sailing of the tubulars and compression stations is on schedule, with all  equipment  anticipated  to  arrive  in  Colombia  prior to mid  August  2017.    Construction  of  the  flowline  is  anticipated  to  commence in the last week of August 2017.  Pressure testing of the  flowline and compression stations is anticipated to commence in  mid  November  2017,  with  the  flowline  anticipated  to  commence  deliveries  of gas  to Cartagena  via  a connection to the Promigas S.A. pipeline in Bremen on December 1, 2017. 

The company keeps finding more gas and has plans to get it to lucrative markets on the coast. They are receiving premium pricing because the Chevron field that used to supply the majority of the gas is in terminal decline. If the the management can execute and get the pipeline done on time we will see a huge jump in cashflows.

Exploration success is leading to reserve growth

Chevron had a monopoly now it will shift to Canacol 

The upside is the oil properties that Canacol still holds. The under-investment into finding oil reserves will lead to an eventual price spike in oil at some point.
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