resources

[Russ]

Everyone is nervous about resources.Yet if Buffett was here I bet he would be buying the likes of bil,agl and sol right now based on fundamentals.

[Maggie]

If I had the money I would be buying SOL.

[Russ]

The rand also seems to be weakening.If the resources hold up this will help.

[pirates]

well i have plenty invested in agl at an average of 390 so i hope you guys are right

[#5]

Which fundamentals are you referring to in particular? Plunging resource prices? Rapidly increasing input costs? The P/Es of 9 or more, when there are a number of quality companies trading at P/Es of below 6?

[Russ]

We are.Just be patient.

[#7]

Could I be presumptious and add that if I was Buffett, I would rather look at the likes of ART, ILA, LEW, SBG, CBH and FPF.

[doomsdayza]

I know for a fact Buffet has never bought a gold share, not sure about resources in general though. Think he's more into buying good businesses than shiny metals which people tend to value (and the company's producing the stuff :) 2c worth for the evening.

[Russ]

If you have another 2c worth put it into agl and turn it into 4c worth in a couple of years.

[doomsdayza]

Don't think my fundamentals = your fundamentals Russ. But to be honest I don't own a gold share and I don't have them on my watchlists. Will keep an eye out though. Have you done valuations on AGL if you coming from a FA point of view? You saying the share is under valued by half? I personally see gold shares as too specialised to perform FA on. DOn't have the time at the moment.

[Russ]

Dooms,I havn't done fundamental analysis on it,actually. I just believe that commodities and energy are a good long term story,that this is a correction in a commodities bull market,and that Buffett would "be greedy when others are fearful".Nobody can call the bottom but the last time agl and bil plunged like this (from nov 2007 to jan 2008 they recovered very strongly).I remember seeing Clem Sumter on tv about 2 years ago saying that commodities would be strong for another 15 years or so due to the massive demand from China and India,but that there would be some shocks along the way. I think we are just seeing a "shock" at the moment.omo,I know not everyone would agree.

[#12]

gold is a currency (a store of intrinsic value)...not a commodity (something used in the consumption cycle)...

[#13]

....that is unless you sporting some on your smile....

[BRE]

There's a fundamental error in the assumption that Buffett buys at fair value. He doesn't; he buys at highly discounted prices. That is when everyone, even the Buffett wannabees, are fearful. We're not there yet. I wouldn't stake my future on Clem Suttner. Two year ago China and India were steaming ahead. They aren't anymore ... India's inflation is like ours, over 10%. China's growth is also slowing...is bye-bye 15 years demand? Gold is a hedge against the dollar which is why it's not a surprise the USD is strengthening while gold is weakening ... Also when you look at the JSE, we're clearly not in a bull market. The third phase of the bull is gone. We're in a highly volatile intermediate phase. We're also in an emerging market with lots of investors from Europe and the US, and they are facing a possible recession so a lot of that money is and will continue to leave the market.

[Russ]

Those Chinese gymnasts are the best.