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Monday, November 15, 2010

On Your Mark . . Get Set . . . Dig!

"The Levi Strauss Strategy"

Caterpillar Inc. said it will buy mining giant Bucyrus International Inc. for about $7.6 billion as the heavy-equipment giant looks to bolster its mining-equipment production.

--"Caterpillar to Buy Bucyrus"; Wall Street Journal (11/15/2010)

What do corporations do when the price of metals -- both base and precious -- double and triple?

Start digging.

Or, in the case of Caterpillar, buy a company that makes digging equipment.

Call it the Levi Strauss strategy: there's as much (or more) money to be made selling supplies and equipment to the gold diggers, as there is in digging for gold.

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