“The debt ceiling is the least of our worries.”
That is how Barry Ritholtz, CEO of FusionIQ and author of The Big Picture, concluded his Washington Post article from this past weekend.
In a piece entitled Debt ceiling: 10 lessons beyond that crisis, Ritholtz argued that many financial and economic issues in the U.S. more important than the debt ceiling unfortunately remain unresolved.
“We have created an intensely concentrated financial industry, where a handful of banks control the majority of assets,” he wrote. ”Competition is less than it was before the crisis, and bank fees are creeping upwards. While risk-taking remains rather subdued, history informs us it is likely to return as the crisis fades in the collective memory. The bailouts left us with a legacy of poor balance sheets and moral hazard. None of 10 factors discussed above have been, in any meaningful way, resolved.”
To his credit, Ritholtz was one of the few market pundits waving the red flag over the housing and credit bubbles in 2006 and 2007, prior to the financial crisis.
His ten unresolved issues consisted of ultra-low interest rates by the Federal Reserve, the flawed rating agencies model, radical deregulation of derivatives, subprime loans, leverage rules, mortgage underwriting standards, automated underwriting, the repeal of Glass Steagall, state banking regulations, and the GSE’s (Fannie Mae and Freddie Mac).
In light of these items, Ritholtz noted that “We’ve got some major and prolonged challenges: ongoing debt issues, structural unemployment, a housing overhang and continued economic frailty.”
While he did not discuss the investment implications of these matters in the article, the significant uncertainty stemming from these issues is likely to provide a favorable environment for gold and other safe haven asset classes.
Platinum Group Metals Advancing to Production
The start of underground tunneling is scheduled for late July 2011. Full commercial construction is budgeted at $443 million and is expected to involve project loan financing once a full mining rights are approved and concentrate off-take terms are established. Full Platinum Group Metals News Release.
- In March 2011, Platinum Group Metals received the consent of the South African Department of Mineral Resources (DMR) for the Company’s plan for underground development of decline access for Project 1 and related environmental management program.
- In April 2011, the Company filed a mining right application and social and labor program with the DMR for the Project 1 Platinum Mine. This application was later accepted for processing by the DMR.
- In May 2011, construction for Phase 1 on surface infrastructure, excavation and construction began – it is proceeding safely and is on schedule.
- In early July 2011, the Company announced that underground mining contractor JIC Mining Services was awarded the contract for Phase 1 underground development of twin 1,200 meter central decline tunnels into the Project 1 platinum deposit for the purposes of retrieving a bulk sample and information for further mine design. JIC is now mobilizing to site.
