Travel Diary: Vancouver Cambridge Resource Conference

by John Lee, CFA
johnlee@goldmau.com
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01/23/2008

Vancouver Cambridge Resource Conference (January 20th-21st, 2008)

Cambridge Conferences are the world’s largest resource conference by attendance. This January’s edition featured over 400 resource companies with attendance in the thousands.

We had the pleasure to exhibit at the conference, where I also participated on a panel and workshop. The crowd was as big as ever, and I was up 9:30am for the Political Risk debate. The speaker hall was standing room only.

John Lee, David Coffin, Henk Krasengburg, Lawrence Roulston

Q: Political Risk vs Project Risk:
Political risks are the likes of Gabriel (GBU.to) of Romania, Apex Silver (SIL) of Bolivia, Aurelian (ARU.to) of Ecuador, and Moto Gold (MGL.to) of Congo, Ivanhoe (IVN.to) of Mongolia. Project risks are the likes of Galore Greek of NovaGold (cost overrun).

Q: Which region I like:
I like anything that’s cheap and has good upside. We have to understand the nature of junior speculation; you wouldn’t bank everything on one junior story just like you wouldn’t mortgage your house on one lottery number. Buy when there is blood on the street, and bag profits along the way. There is risk in every country for every project.

Q: What do major producers look for:
They make mistakes like all of us. Rio Tinto is sinking tens of millions monthly in Mongolia with Ivanhoe without a formal agreement in place with Mongolia government, and Newmont spent $1 billion on Miramar for a project where many doubt its economics. However one thing majors look for is size, and reasonable assurance of low political risk.

Final Advice:
Use technical as trends, buy low, sell high.

The Mau Capital Team.

John answering questions.

On Monday 8:30am, I conducted a workshop where we gave out a 22” LCD monitor and ten 1 oz. silver coins. In the presentation I talked about the US debt implosion, which has now spread to high quality mortgages, credit card, and city municipal debts. Then we talked about six companies I like. The presentation can be accessed here.

John at his workshop on Monday.

Overall it was a great event. I saw many familiar faces. The traffic was good and the speaker halls were always packed. The views on markets are mixed. Many took the short-term cautious, long term bullish on gold and gold equities. My take is gold has made the bottom at $850, and gold equities are ready to rise quite violently in the first half of 2008 as soon as we see a relative calmness in general equities. The Fed and US government have implemented a number of measures to ensure a steady stock market. You can access the presentation here.

Mr. Howard Fitch and Mr. Joe Martin never fail to put on a good conference. Next stop is Phoenix Feb 9, 10 (www.goldshow.ca). I will see you then!

John Lee, CFA
http://www.goldmau.com
johnlee@goldmau.com
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