San Francisco Metals and Energy Update

Thursday was a whirlwind day at the energy and mining conference I attended in San Francisco. I had an excellent amount of one-on-one face time with companies, in one private meeting after another. I found at least one company I want to buy ... and a few I wouldn't touch with someone else's 10-foot-pole.

I heard a great phrase to describe some of the junior explorers -- "penny dreadfuls." It's not that these companies are run by bad people. But I see no reason to buy a company that has only $6 million in the bank and needs to spend $50 million in the next two years. And even after all that, it will have years to go before it becomes a mine, if ever.

Meanwhile, the outlook on gold is something I'll call "grimly determined."  No one is willing to call a bottom in the gold price.  But many are saying that with companies at these prices, they're just too cheap to pass up.

As Agnico Eagle’s chief financial officer, David Smith, said “Frankly, if you aren’t buying now, when are you buying?”

I’ve seen some great companies in San Francisco, including …

• A company that is racing ahead to develop a rich deposit of a wonder material that is changing the world around you.
• A silver and gold producer that has demonstrated it knows how to make bargain-basement deals when everyone else is panicked … and will have enormous potential when prices turn higher again.
• An energy company that is leveraged to the price of oil and gas in Europe, which is higher than in North America. In the case of nat-gas, much higher. The company is growing its cash flow, grodwing its dividend and making smart acquisitions.

I was impressed by these and many more. Subscribers to my Gold & Resource Trader will see the best of them. Stay tuned for analysis, videos and more next week.