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Canaccord’s Chutzpah

Chutzpah (n): “…gall, brazen nerve, effrontery, incredible ‘guts,’ presumption plus arrogance such 
as no other word and no other language can do justice to…/…that quality enshrined in a 
man who, having killed his mother and father, throws himself on the 
mercy of the court because he is an orphan.”
The Joys of Yiddish, Leo Rosten, 1968
Your author wet himself laughing at this week’s edition of Canaccord’s “Metaland” weekly report on the state of the junior market. Not because of the usual blather and sophistry included from the hand of Wendall Z-Man Zerb and Nicholas CampbellSoup, but because of the jawdropping brass neck on display.
The main essay’s subject was on why gold mining equities were currently so hated by the investment community and the jolly fellows at the Can of Corn offered up their reasons as to why that might be so. Here are two of the main bullet pointed thoughts that The Z-Man & Soupy Show put forward, (you can download the whole thing here if your stomach is strong enough, that is):
Too many low-grade deposits: High gold prices have allowed companies to significantly reduce cut-off grades applied to new deposits and resource estimates. It is no longer unique to have a one million ounce gold project. As grades have dropped, the focus shifted to scaling up projects to benefit from economies of scale, which have resulted in substantially higher capex requirements. The net result is operations that have high capex (which is tough to finance as a junior) and relatively high costs (which is less attractive for larger cap producers).”
“Over-promote/under-deliver: Unfortunately, some of the more promising, much hyped new discoveries that have been announced over the past few years have not lived up to the heightened expectations of investors.”

IKN back. What brass neck! The guffaws were loud and hard at IKN Nerve Centre™ because it’s Canaccord that’s been running these bullshit pumps! For years! Who pumped the low grade, über-high capex, under-delivering Exeter Resources (XRC.to) (XRA) to the mouthbreathing end of shareholder community for years? WHY IT WAS WENDELL ZERB OF CANACCORD! Excerpt from here (a time when XRC.to was a $5 and $6 stock):

Wendell Zerb, Canaccord Genuity (1/18/12) “Exeter Resource Corp. has released the prefeasibility study for its 100%-owned Caspiche Au-Cu-Ag project, with results as expected. We maintain our Speculative Buy rating and 12-month CA$9.35 target price. . .Exeter’s Caspiche deposit remains one of the most significant new Au-Cu-Ag discoveries in the last decade; located in the Maricunga belt in Chile and adjacent to Barrick’s Cerro Casale and Kinross’ Maricunga (Refugio) deposits, Caspiche is well located as this prolific district expands. . .we continue to value Exeter on metrics related to it ultimately being acquired.”

And who pumped Batero Gold (BAT.v) like there was no tomorrow for the whole of 2011, that total trainwreck disaster of a low grade, ultra low cut off BS pump for years and was calling this a $10 target as late as January 2012 that dropped 2/3rds of its share price to the current 0.80s levels once the truth became apparent? WHY IT WAS NICHOLAS CAMPBELL SOUP OF CANACCORD! 

16/1/2012 Analyst Nicholas Campbell of Canaccord Genuity is maintaining his rating on shares of Batero Gold Corp. (BAT.V) as the company released promising drilling results from its Colombian Batero-Quinchia mine, The Globe and Mail reported.
The Globe said he is expecting an initial resource of at least 7 million ounces of gold, with longer-term potential for the project to develop into a 10 million ounce gold resource.
Canaccord Genuity maintained its “speculative buy” rating and 12-month target price of $10 on the stock.

And believe it people, there are many, many more bullshit pumps from that den of iniquity which match the profile. Andina (ADM.v) was a Can of Corn pump vehicle. Its relationship with NadaGold (NG) goes back over a full decade. Northern Dynasty at Pebble got the P&D from Canaccord on its unpermittable Pebble thing up North. And on and on and on we could go. But now, after manifold examples of pumping and over-promoting low grade high capex gold things over the years, these utterly shameless individuals want to make themselves out to be industry vigilantes, policing and cleaning up the streets of shame so that we lesser mortals can walk down them with no fear.

Leo Rosten step aside, sir. There’s a new definitive definition of “chutzpah” in town. Origins: Canada.

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