SPQ and the Ring of Fire juniors are speculative stocks. If you've forgotten that fact, it's time to understand what might affect them on a micro and macro scale.

Bill Belovey was on BNN (Business News Network) last night. In the first part of the interview at 7:30 p.m. EST, he talked about the YEN Carry Trade and its impact on speculative stocks. He said that the carry trade in the equity markets drove gold down over US$24 on Monday; today I notice that gold is up in pre-markets US$15. Welcome to the carry trade, market volatility, and day trading. Have a look at these sites:

http://www.bnn.ca/shows/past_archive...

http://www.investopedia.com/terms/c/...

Although it's not on the BNN site, Bill also talked about the fact that China has used 2 billion tons of steel in infrastructure projects this year. By the way of contrast, the USA has used 20 billion!!! One can infer that these infrastructure projects also use lots of nickel, zinc, and copper. Where will China (and India) be in 2, 5, 10 years? Most analysts agree that their economies are going to grow at staggering rates.

Ironically few large mining plays (exploration plays) are being developed. For those new mines being developed, they often are found in politically unstable countries. Moreover, the recent interest by BHP Billiton in taking over RIO is about huge corporate consolidation, not the development of new mines. Therefore, who will supply the infrastructure needs for developing economies?

Canada, perhaps. McFauld's and SPQ perhaps. But that's a long way off. We're only in the exploration stage. TDEM surveys are being done, and drill bits are exploring in the muskeg. However, we've had some exciting glimpses. And I believe more are to come.

So what should the SPQ investor do? Take a cue from Real Estate: replace Location, Location, Location with Patience, Patience, Patience!!! Since we already have location (think McFauld's), all we need is patience.

Snug