You Can’t Pay The Bills With Paper Profits

Aug 12th, 2009 – Comment

Paper profits are cute but you can’t pay the bill for steak and mushrooms with them.

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Lou Schizas is an equities analyst, investor, entrepreneur, professor and television and radio personality – and a true believer in the happiness-inspiring powers of capitalism.

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Hi Lou,

Could you please comment on (V.)? The company has strong management, and is well-funded. ATAC seems genuine in their approach to their Rau Property with an aggressive drill program, and have released what look to be positive results. Yet Tuesday’s high volume and huge swing in share price leaves some doubt. Buy (more), sell, or hold. Thank you for your time!


Hi Mike,

Thanks for the assignment. I think that you are asking yourself a very important question. Is it time to hit the silk and bank some cash?


The three year chart clearly indicates that ATC has run and run hard from the pitiful lows of late 2008. The returns for investors who got on the ride early have been nothing short of fantastic. Steak and mushrooms on the menu for those heroes when they get home!

Your concern about the volume and direction of trading shows that you are paying attention. Which is a good thing. As you mentioned the company put out a press release that indicated positive drilling results at their Rau gold property in the .

For those not familiar withAtac Resources Ltd. they are in the business of identifying and acquiring grassroots and early stage gold prospects. They have 26 properties in the Yukon and 1 in B.C. according to their corporate presentation that is posted on their web site.

You are asking yourself if the results were good why were investors selling? Because they could. Investors with experience speculating in the junior resource sector know that profits are not always available. You have to book them when there are buyers willing to trade cash for your paper.


The three month chart also gives a good view of the range bound trading on ATC that goes back to July and the MACD turning below the signal line in the later part of the month.

These signals plus the fact that the cruel month of September is nearly upon us probably had many investors in ATC deciding to take some money off the table and pat themselves on the back.

Paper profits are cute but you can’t pay the bill for steak and mushrooms with them.

Happy Capitalism!

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