Why The Fraser Mining Survey is Fake News
Kitco Commentaries | Opinions, Ideas and Markets Talk
Featuring views and opinions written by market professionals, not staff journalists.
Junior resource sector speculators are often subjected to this or that company’s insiders and promoters informing us in no uncertain terms that this or that country, department, prefecture, province, state, or territory is the “fill-in-the-blank”-best jurisdiction in the world for mining investment.
Of course, the promotions refer to the jurisdiction in which their flagship projects are located.
The quoted source is the Fraser Institute’s Annual Survey of Mining Companies. This survey has little utility or veracity because it has no scientific methodology or basis. In fact, it is nothing more than an opinion poll from a small group of selected individuals.
The Fraser Institute’s Annual Mining Survey is, quoting Seinfeld from1991, “â€¦ just so much fluff.”
Herein I document the dubious metrics of the annual survey and why it is (or should be) of no import in a speculator’s evaluation of junior resource companies.
But first, who is the publisher of the survey and exactly what does it do?
The Fraser Institute is a Vancouver-based think-tank with a strong ideology of free market capitalism and individual freedom. According to its website:
My detailed investigation reveals:
The Fraser Institute was founded in 1974 and receives no public funding. In 2016, it was supported by voluntary donations from individuals (83%), foundations (2%), and organizations (15%), plus minor publication sales and interest income.
Among its programs, it conducts research and produces reports, videos, infographics, and commentaries focused on more than 15 different subjects; hosts educational programs, seminars, and symposia for students, teachers, and journalists in British Columbia, Alberta, Saskatchewan, Ontario, and Quebec; and provides rankings of elementary and secondary schools in four Canadian provinces.
According to University of Pennsylvania rankings, it has been Canada’s top think-tank for ten straight years.
In conclusion, the Fraser Institute is a well-respected, privately-funded organization with a libertarian-leaning, free-thinking philosophy dedicated to the betterment of Canada and its citizens.
Now let’s examine the Fraser Institute Annual Survey of Mining Companies; i.e., exactly what it is and also what it purports to be:
For the 2017 survey:
The Fraser Institute’s survey methodology is not based on valid statistical parameters and has no scientific merit. I submit that it is of little use to investors for many reasons:
Therefore, the exploration expenditures reported by Fraser survey respondents were only about one quarter of the world’s total budget for non-ferrous minerals in both 2016 and 2017.
Senior Director for Natural Resource Studies Kenneth Green and Policy Analyst Ashley Stedman featured a headline: “Good newsâ€”Ontario improves in the eyes of mining investors”; and this statement: “Mining investors have a gloomy outlook for Manitoba’s mining industry compared to other provinces”.
In my opinion, the Fraser Institute’s conflation of their unscientific opinion poll of 360 mining company insiders and the views of millions of investors in the worldwide exploration and mining sector is simply fake news.
In fact, it reminds me of the ubiquitous survey in the magazine that has been strategically placed on the coffee table in your hotel room. You know, the one commissioned by the State Tourism Agency and local Chamber of Commerce promoting your present location as the newest and hottest must-see tourist destination in all of America.Â
As a professional retail speculator, I choose to do my own research and due diligence to determine the geological, geographical, and political jurisdictions in which to gamble my hard-earned dollars.
And folks, you must do the same to skew the odds in this high risk / high reward game in your favor.
Rest assured that the Fraser Institute’s Annual Survey of Mining Companies is not on my reading list for any investment decision in the junior resource sector.
So the next time some company CEO / VP Corporate Development / VP Exploration / IR Director and/or spurious promoter wants to woo you with a tidbit of dis-information from the Fraser Institute’s annual mining survey, why not call his bluff and say exactly what Marlene said to Jerry:
“I saw your act â€¦ to be honest, it just didn’t make it for me â€¦it’s just so much fluff.”
Ciao for now,