When it looks as though things couldn't get worse for precious metal mining equities (GDX), that may be just the time to buy for contrarians. Not only are the junior miners (GDXJ) sloping to historic decade lows, but gold (GLD) bullion has been hit hard recently by short selling, bearish bank reports and margin calls.
Now that junior miners have already been crushed as much as 45% from their 2011 highs and the advanced exploration companies have already been cast overboard. Dennis Gartman is advising his clientele to “abandon” them because even when gold rallies they don’t rally.
I am appalled by the judgment of mining analysts and managers in the rare earth space. The primitive state of the economic analysis of the rare earth supply and demand sector is indicative of poor understanding of resource economics.