The Firearm Blog

Time to buy gun shares? CNBC says NO, and so do I.

While S&W (SWHC) sell a wide range of M&P branded AR-15s, Ruger (RGR) sells the Mini-14 / Mini-30 (and since recently high capacity Mini-14 magazines) and Olin Corp. (OLN, makers of Winchester branded ammo) is selling overprice ammo, along with everyone else, I suggest you stay away from all three.

So, why not Ruger and S&W? In 10 words … a gun sold today is a gun not sold tomorrow. There may be a mad rush to purchase evil semi-automatic rifles, handguns and “sniper” rifles today but in the long run, even if there is no AWB 2.0, sales will drop. If/when there is an AWB then sales will drop unless the manufactures manage to ensure the AR and Mini-xx family of rifles is are banned by name, and even then they will be competing with the pre-ban market.

So why not Olin? Apart from my prediction yesterday that ammo prices will drop in 2010 or sooner, Olin does many other chemical related manufacturing, ammo is only part of the business, so betting that the stock price will go up based on ammo prices would be a mistake.

Share price (60 day moving average in red) over the past year. Charts from Yahoo Finance:

Ruger

Olin Corp.


S&W

Two years ago, an M16 automatic rifle could fetch $5,400 or more in the Palestinian West Bank. Now buyers at Hebron’s clandestine gun market are asked to pay more than double.

Four months after Islamist Hamas routed secular Fatah in the Gaza Strip, fears that clashes between the Palestinian rivals could erupt in the West Bank and uncertainty ahead of a U.S.-led peace conference are fuelling a scramble for guns.

Dealers at the gun market in Hebron, the West Bank’s most populous city, say weapons sales have jumped by up to 70 percent since Hamas took control of Gaza, while buoyant demand and supply bottlenecks due to tighter security have inflated prices.

In the northern West Bank city of Jenin, every bullet for an AK-47 rifle costs 35 Israeli shekels, or more than $8. In Hamas-controlled Gaza, an AK-47 bullet goes for 4-6 Israeli shekels, $1-1.50.

I have heard it said that gun prices reflect upcoming conflict….

Also, I wonder where they get M16 or AR-15’s from.

More here.
Hat Tip: Little Green Footballs

Very interesting blog post about the 17th Century Firearms trade in America and impact on the Indians of the northeast.

Of all the trade goods the European introduced to the American Indian, the gun has had the most broad-ranging effect, both positive and negative, on native and settler alike. As a tool for hunting the gun helped the Indian provide more food for his community, which in turn led to a better standard of living and provided for greater population growth. On the other hand, this increased efficiency also made it possible for the Indian hunter to harvest more animals than could be removed from the environment without having a negative impact on the ecology.

Not only did the gun allow for more efficient hunting, it provided a better means of making war. This in one respect could protect a small tribe from a much stronger neighbor, but could eventually allow some nations (as in the case of the Iroquois) to utterly destroy their own weaker neighbors. The gun, as it still is today, was a helpmate when used as a tool for feeding or defending the family, and was a terror when misused as an apparatus of uncontrolled destruction.

More here.

The economist has a very interesting article about how criminals in the UK appear to lease firearms from each other for use in specific crimes. The same firearms are used in crimes all over the country!

Some have suggested that would-be thugs are renting guns to use as fashion accessories. Daniel Silverstone of Portsmouth University is sceptical: “It would be cheaper to buy a replica,” he points out. “Someone who hired a real gun would probably intend to use it.” Renters must either be very short of cash or in need of a gun at very short notice, he reckons.

More here.