The Original Uranium Bug and the Original Gold Bug - CBS Marketwatch on Dines

[davidslane]

Interesting read from CBS Market Watch on Dines.
Intrigued by how much they give away.


http://www.marketwatch.com/news/story/dines-still-glowing-about-uranium/story.aspx?guid={76CCB549-7493-4B8F-97DB-6FAD336841AA}&siteid=yahoomy


NEW YORK (MarketWatch) -- The Original Uranium Bug and the Original Gold Bug (they're the same James Dines) is breathing easier.

Dines, the octogenarian editor of The Dines Letter, was our Investment Letter Editor of the Year in 2006. See Jan. 1 column

More than 20 ago, he brilliantly reinvented himself as an active stock trader, after arguably staying a little too long with his first great insight: that the inflationary 1960s would doom the dollar and boost gold. (Hence Original Gold Bug).

Dines' reinvention worked. The Dines Letter is up 28.2% over the past 12 months vs. 15.1% for the dividend-reinvested Dow Jones Wilshire 5000, according to the Hulbert Financial Digest. And over the past 10 years, Dines is up an even more impressive 19.8% annualized vs. 7.4% for the total-return DJ Wilshire.

With spot gold back above $800 for the first time since 1980, Dines like many gold bugs could be pardoned for thinking that the conditions of his youth have returned. See Oct. 18 column

Indeed, Dines writes in his last letter, published in late October: "We would be very surprised if the gold price did not blast right through the old highs, and we reaffirm our old targets for gold of $3,000 to $5,000 an ounce (Plus silver over $100 an ounce) ... gold is not merely a colorful trinket but a monetary asset, and when mass fear strikes at the heart of paper money, the stampede to gold will be awesome."

What has really distinguished Dines in recent years, however, has been his advocacy of uranium. He argues that, ultimately, the only energy choice is between coal (resulting in global warming) and uranium.


When I last checked in with Dines, uranium had stumbled after a multi-year run. See Aug. 20 column

Dines was distressed but determined.

He now feels vindicated by the subsequent rebound, noting that many uranium stocks are back to the levels they achieved earlier this year.

He concludes: "Uranium action this year thus appears to be an example of an unusual "Major" consolidation, while the uranium market tries to figure out which path to take. We must remain stoically calm, and not allow our emotions to whip us back and forth ... Although stock market trends could change and force us to completely reassess the situation, events are proceeding as though an important bottom is behind us.""

Other Dines views: "Stock markets are getting a bit oversold here, and we are looking for a rally in the S&P 500 Index anytime, somewhere between the 1,420-1,495 areas, probably in November, paving the way for the traditional year-end rally."

But Dines still rates himself "long-term neutral" on stocks.

On bonds, Dines writes: "We are generally bearish, because bonds are overpriced. We would still avoid corporate or "junk" bonds, but instead stay with very short-term U.S Treasury paper or cash. We expect higher interest rates ahead ... This is not an enriching arena yet."

These stocks are rated "buys" in Dines' top-performing "Long-Term Growth" portfolio:

Pan American Silver Corp.
Denison Mines Corp.
Laramide Resources Ltd.
Fronteer Development Group Inc.
Mega Uranium Ltd.
Paladin Resources
Uranium One Inc.
Arafura Resources

[Croaker]

Knowing how Dines is with allowing his picks to go public, you can bet he pre-approved the disclosure. Lets see if those stocks will go up, I would suspect that was the plan when the information was release.

On that note, it should be an interesting week with the Market after Citibank latest news release. Hopefully there will be some buying opportunities with Caseys and Dines picks.

Croaker

[H3O]

Another comment on Dines from Marketwatch PETER BRIMELOW

Dines down ... but not out?

Commentary: It may be time for the 'original' gold bug to reinvent himself
By Peter Brimelow, MarketWatch
Last update: 11:43 p.m. EDT June 12, 2008NEW YORK (MarketWatch) -- The original uranium (and gold) bug is under pressure, again. But he's holding firm, for now.
Those entomological praise names are among many that James Dines, octogenarian editor of the Dines Letter, has bestowed upon himself.
Modesty is not one of Dines' faults.
But he had a brilliant run in the post-2000 commodities boom, partly powered by the uranium upsurge. And when I last checked, it looked like he's recovered from uranium's stumble last year. See Nov. 5 2007 column
It didn't last. Currently, TDL is the 172nd-best performer over the past 12 months according to the Hulbert Financial Digest, down 29.4% vs. negative 6.3% for the dividend-reinvested Dow Jones Wilshire 5000.
But this is in dramatic contrast to TDL's performance over the past 10 years: a 16.32% annualized gain, vs. 4.83% annualized for the total return DJ-Wilshire 5000.
Over the past five years, TDL achieved a 17.88% annualized gain, vs. 10.92% annualized for the total return DJ-Wilshire 5000. I named him 2006's Letter of the Year. See Jan. 1, 2007 column.
But since the HFD began following TDL in 1980, the letter has achieved a 6.5% annualized gain, vs. 12.2% annualized for the total return DJW. This reflects Dines' dramatic history of alternating success and disaster, followed by -- let it be noted -- reinvention and resurrection.
Basically, Dines' problem is that of a particular type of market maven: the turn-caller, who makes wild and woolly prophesies, as opposed to the trend-follower, who skulks along being right (and wrong) with the crowd. A classic trend-follower: the late Richard Fabian's Telephone Switch Newsletter, with his 39-week-moving-average system. See Mark Hulbert's June 10, 2003 column
Temperamentally, I prefer turn-callers. But then, I've never voted for a major-party presidential candidate. And, for the record, the evidence of nearly 30 years of HFD monitoring is that both turn-calling and trend-following can work ... in the right hands.
Right now, Dines is not budging. Using the royal "we" as usual, he writes bitterly: "Since we expected commodities to go higher, we figured uraniums especially would prosper because if what we have been calling the Coming End of the Age of Petroleum," and flash-forwarded to a multi-generational switch to nuclear power that would lead to a multi-generational boom in uraniums. That has come true, as the long-term price of uranium remains solidly around $90/lb, up 1,025% from our recommended price at $8.00."
Dines' explanation of uranium stocks' stumble: "While we were way ahead of the Mass in forecasting the real estate crash, we perceived no connection between real estate and uranium, but there was indeed a subtle one that nobody caught: fanatically secretive hedge funds had loaded up on uranium stocks, so margin calls from their plunging real estate investments forced them into massive dumping of other assets 'just for the money,' excluding consideration of value or long-term prospects. That explains why the price of uranium remains high why the corresponding stock prices are low..."
Dines' conclusion: "[in the next upcycle] patient stockholders should see energy, and especially uraniums, among the earliest and greatest leaders."
Commenting on a chart for Paladin Energy Ltd. (PALAF:PALAF

 Dines says: "Correction in this leading uranium might be ending."
Maybe. But it's also possible Dines could go through another explosive reinvention. And resurrection.
We'll be watching. 


http://www.marketwatch.com/news/story/original-gold-uranium-bug-under/story.aspx?guid=%7BDA5F76E1%2D26B0%2D4048%2DACE1%2DFDDFA149298C%7D&dist=morenews

[dananini]

this arrogant man should be assinated

[john77]

dananini,
from the sound of your post, it looks like you may have made the mistake of checking in on your uranium prices! Much better to just get the tone from here if you aren't going to trade them actively. Much better for the sanity and the blood pressure!

Davidslane,
I didn't see much of a recovery in U stocks today. They all ended pretty much in the dumps.

[dananini]

John, i held out for a couple of days, but with spot up $4, i had to take a look.
i read, i watch, i listen, but cannot figure out the bad sentiment.
i didn't sell my remaining u crap, so now i do have to hold for probobly many years.
can't do much now either.scared money always loses