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Silver Wheaton Corp. Message Board

  • happiesthihosilveraway happiesthihosilveraway Jun 20, 2008 2:48 PM Flag

    JMHO - WHY SLW is not performing

    i sold out after about the 2nd or 3rd financing deal slw did with explorers not producers as it had done in the past. all those millions and nothing accretive to cash flow for years to come. prior to this type action, slw was buying from actual producers and the money was flowing directly to the bottom line. SLW has too much debt now to support a growth story bottom line. just wait till you see this quarterly report in august, yikes you will be surprised. bear creek has been a good investment and i think by december slw should sell. gg selling out didnt help matters either. the next 18-24 months slw will underperform in relation to its past performance due to financing its debt. what they did is likened to betting on the come and i do not like that.
    do not get me wrong, i love the concept, they just went off course in their recent contracts to acquire silver. what will most likely happen is silver will go over 25.00 an ounce and that will help, but slw will lag further and further behind the price relative to silver that it once had - until the developers become producers and the cash flow returns. so that in itself makes slw a long term play and screws profitability short term. rate hold at best for now

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    • Ted's problems were with the orange juice market in the late 70's and 80's when Anita Bryant was singing about and yapping about the OJ soaring prices

      I'm not sure what the involvement was with Ted but( ler)...he did mention his problems in one of his articles a couple o years ago....

      anyway this a different market and the facts are we are using more and more silver every year...


      On his own web page he talks about his problems:

      Cook: You got into trouble once for trying to take delivery on orange juice futures. Maybe they should have had those no delivery contracts back then.

      Butler: Very funny.

      Cook: How about explaining your orange juice travails?

      Butler: First of all, it happened a long time ago, over 20 years ago. And it was a very trying and painful time in my life. Not only did it have a very adverse impact on my wife and children, it still impacts me to this day.

      Cook: If you don't want to go there, I'll understand.

      Butler: I won't get into the personal aspects of it, but there are some things that can benefit others. I was a commodity broker and had all my clients, including myself, long September orange juice, either outright or protected with spread positions in more deferred contract months. I had been in the position for a long time and although the price was substantially higher than originally purchased, it still didn't reflect true value in my opinion. I did all my own research and felt strongly that there was not enough orange juice to back up the shorts' contracts.

      Cook: So what happened?

      Butler: When first delivery day arrived, one large customer of mine stood for delivery on over 1000 contracts. I had arranged, months before, for him to borrow the 20 million dollars in case delivery became necessary or desirable.

      Cook: And?

      Butler: And all hell broke loose. The CFTC and the Exchange started calling and wanted to know what was going on. I explained to them that I had notified the Exchange, months before, of the likelihood of my customer taking delivery, and why were they asking now? To make a long story short, they pretended to deliver on time, but they really didn't. They later charged the customer with attempted manipulation and I and the firm with various related record-keeping charges.

      Cook: Did the charges stick?

      Butler: The big attempted manipulation charges were thrown out by their own administrative law judge, but the record-keeping charges stuck and it caused me to leave the brokerage business, even though I knew I did nothing wrong.

    • Re SLV. I could care less if there is 1 oz of silver in the entire ETF. As long as it tracks the POS is all that matters.

      I have physical silver and gold and I hold them in case there are problems. For trading fast in/out I use GLD and SLV. All I want is a tracker.

      do some research on Butlers history. I'm tellin ya, he was dirty and was banned from trading. Those are facts that he doesn't like talking about. Maybe he found Jesus and is pure as the driven snow now...but I doubt it.

    • I got in in September '05 and read your comments from then along with

      Vilmuchuka...I might have that handle wrong ...I just did not post my

      thoughts much....I believe until the naked shorts are forced to cover and

      are thrown in jail, this stock will be screwed with...Just like spot silver last

      night in London at 4 am eastern time the boys hammer gold and silver

      and do it again at 9am here in the's a crime...hang in there

      for the long run with physical and play with this stock and others like EXK

      or MNEAF in the meantime....

      Silver(squeeze)Box...pun intended for the shorts

    • p.s. I'm not sure how assailing Butler's character helps your cause as I believe the story was not originated by him , but just picked up by him. I imagine GATA ran it fairly early on.

    • I'm curious Dbtunr, since you seem to be an advocate of SLV could you tell us who the custodian of th metal is for that fund?

    • I read Butler just like I read other guys as well. He is not the be all and end all

      Did you know his trading license was revoked for some type of imprepriety?

    • you were here since $4? How come I don't ever remember a post from you back then?

      This is a different company then when it was back then. Much more debt, more shares, more exploration risk. No longer a pure play. It's almost a mutual fund without dividends

    • Your concerns are not shared by John Doody (Gold Stock Analyst), and Doody has SLW as one of his top 10 picks, with a target of $25 a share and royalties of $1.27/share by 2010, using $18/oz Ag. Doody's top 10 picks have gained 785% on average since 2001, gold and XAU are up 227% and 275% in same time frame. Many of Doody's subscribers are institutions.

    • Please document where SLW pays explorers. I'm familiar with their deal with Rosemont Mine through Augusta Resources. No money has been spent by SLW and for good reason. This mine may never get built and Augusta may go bankrupt. SLW should not get credit for such future deals but neither should they be punished. I suspect other deals with explorers are also based on landmarks leading tward certain production. Also note that SLW has a PE of 38 in a negative market. It will take time for profits to substantiate a huge rise in stock price. Having said that SLW is still a good long term(and volitile) stock to own. Just don't expect it to go up in price every quarter.

      • 1 Reply to carlos42948
      • YOu are right on the money though I am sure the longs will disagree.

        The Bear Creek and Revett et al are all long term stuff that may or may not pan out. Too much money is tied up in exploration.

        they had a really good thing going with the first 4 or 5 deals. If they just let them continue, they could have started to pay a dividend and bought back shares. Instead they took on debt and diluted the crap out of this.

        I rode this from 4 to 12 almost 2 years ago and then got out. It almost hasn't moved at all in that time and has lagged SLV.

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