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European stocks fell in premarket trading on Monday as tensions between Russia and Ukraine remained in focus. European Union foreign ministers are meeting today in Brussels to discuss the matter and are expected to issue a joint statement urging Russia to avoid invasion. Elsewhere, investors digested Philips' earnings and awaited PMI data from the euro area.
The FTSE 100 was dawn 0.20% at 6:32 am CET, the DAX declined 0.29% and the CAC 40 fell 0.27%.
The euro lost 0.21% against the dollar to go for 1.13172 at 7:24 am CET and the pound was down 0.08% compared to the greenback, selling for 1.35426 at the same time.
Baha Breaking the News (BBN) / NP
Happy Monday y’al
Tibbs, what I understand is results or the lack there-of.
I do not accept excuses for poor performance especially when the excuses seem to be centred around Horgan being "a good chap" rather than any explanation as to why remedial action is taking an apparently inordinate amount of time.
My opinion is Horgan is lacking in the technical/geological side of gold mining, he either needs more support at executive level from people with this background or we need a CEO with dirtier hands. CEY needs real miners at the executive level at the moment rather than deal makers which is reflected in our lousy share price. The market is a relatively unbiased judge of performance and it certainly does not concur with your quite inexplicable hero worship of Horgan.
Spoon
For the first time in a long time, we agree with Jeremy Grantham – equities likely need to correct quite significantly. Here are some simple mental models. The cyclically-adjusted Shiller price-earnings (p/e) ratio is sitting at 37 times compared to its long-run mean of 17 times and median of 16 times. The only time in the last 150 years it has been higher was just before the 50 per cent drop in US equities during the ‘‘tech wreck’’, which resulted in the Shiller p/e falling from 44 to 21 times.
If we suppose that it is reasonable for US shares to normalise back to their pre-pandemic peak on the basis that investors incorrectly extrapolated ultra-low inflation and 10-year bond yields in perpetuity, stocks would need to adjust downwards by 28 per cent.
If we consider a more serious downside scenario whereby equities mean-revert to their December 2018 level (which is when the Fed last had its cash rate at a ‘‘neutral’’ level of 2.5 per cent), shares would have to drop 48 per cent. There are many shortcomings with this analysis. One of the biggest is that this time is different to the recent past in so many ways. Unfortunately, that point of difference implies even greater downside risk.
When was the last time you can remember a US president egging on the Fed to crush inflation and raise interest rates? When do you last recall inflation being a major US political issue? The post-GFC period has been defined by politicians trying to strong-arm central banks into easier, not tighter, policy settings.
Of course, President Xi Jinping is begging the Fed not to hike interest rates given his currency is pegged to the US dollar. Further, China is, like the US, home to hordes of ‘‘zombie’’ companies. In the US, zombies represent roughly 15-20 per cent of all listed firms. These are entities that do not have enough money to service the interest repayments on their debt using existing earnings. Heaven help them if rates rise sharply, as they are now doing. In China, the state has been the primary backer of many of these entities, which can only survive with access to this artificially cheap public sector funding.
China’s latest economic challenges were on display this week with the release of its annual economic snapshot for the year just ended.... headline 2021 GDP growth rate of 8.1 per cent beat forecastsPeople’s Bank of China’s (PBOC) surprise interest cuts on two key lending rates. While flagged by policy-makers late last year,China and the United States are not only moving in opposite directions in the way they manage the pandemic, but they are now at odds over monetary policy.‘‘The Fed and the PBOC are very likely going to be moving in opposite directions in 2022, and that in itself is pretty remarkable,’’ Bloomberg’s chief economist, Tom Orlik, predicted in a December podcast. He notes that the Chinese yuan was historically tied to the US dollar, which meant the PBOC had to raise or lower rates when the Fed did, regardless of economic conditions.‘‘Now, after a decade of careful, painstaking reforms, the renminbi is much closer to a free-floating currency and that has given China’s central bank a new degree of freedom on how it manages monetary policy. We already see them using it,’’ Orlik says in comments that resonated this week.China is the world largest producer of gold, and the worlds smallest seller of goldBut this week Xi was back before Davos, held online for the second straight year because of the pandemic, with a new message. This time he was positioning China as a leader in global monetary policy. In an unprecedented move, he told the United States and other rich Western countries they should not raise interest rates when developing countries were saddled with huge debt...which they cannot repay. Same old game by the west, so smart to offer a better game for the developing countries, which is what China has been doing for a decade or more now.The global financial system does sadly need more rigour and structure and the US, which is near in civil war with a President who has one of the lowest public press conferences for a president (thank goodness), has shown they are not up to the job, to proceed.We live in velly interesting times? I am again! expecting good times for gold.the gnomeps lets not mention the shenaikans going on in the Ukraine?
Hi Dasut,
Binned my post after reading your far more capable assessment. Yes Barrick is global leader but do others not far off in stature wish to secede a Tier 1 asset like Centamin in a possible and indeed probable major world mining location to Barrick. What would the reaction of their shareholders (institutional) to handing Barrick this on a plate!!!! without at least resistance to make Barrick pay at least fair price if not as most aggressive take overs work out above reasonable market value. Going to be a very intersting time going forward and whatever the final oncome in my opinion CEY current SP will be some way forward of where it is at present.
With acknowledgements to Cowichan and have done as he asked.
Bob
It's great reading all the posts today - everyone sees things a little different but still very respectful - raising valid counterpoints just as it should be. Still, a little diversion never hurt...
https://twitter.com/middleeast/status/1485140154545278977
Yes Spot, like Sami ,for instance
That day if my memory ,hazy these days was a Monday.
I had a buy order in on the Sunday.
Was surprised and worried by the drastic drop, but ended up gettinjg a huge holding for my dosh
Which I mostly kept, after buying my new sporty car
Good luck all this week.
My point is that if Egypt for what ever reason, didn't like the takeover or think that its not in their best interest, it wouldn't take much to put in some sort of nonsense legal challenge that as we all know will never be resolved this would have dire repercussions for the bid from their shareholders.
It might even be a challenge from a private Egyptian investor who has a large position in Centamin and knows the true value of the mine and doesn't take kindly to being ripped off.
Not that hazy.
Far from it.
It was certainly serious at the time,you are of course right about the Court Hearing.
I think it was the 'Administration-Court' that did that, not EMRA. - If memory serves, EMRA stood shoulder to shoulder with Centamin in opposing the court's decision. - However, my memory is a little hazy these days.
Certainbly suspended it .
The SP hit 20p.
Was sorted within a week.
Hi Mr Bond - Take your point, mind you, I'm not aware that EMRA ever took licence away from Centamin. - That's news to me.
EMRA can give licences and also take away as Centamin have found out before.
Many of us will remember that.
Takeover or not, if EMRA does not consider it in the benefit of Egypt, it would not happen.
Bristow being well informed, will know this.
Rebess with all due respect to you .the plant ,now paid for is EMRAs and as I said ,so really they have total control. Licences are a privelege if companies lose them ,as Spot said go to court
No one fool themslves into thinking different.
Hi spot - I believe the Sukari licence is owned 100% by Centamin. - So far as I know, the contractual arrangement with EMRA involving their 50% take of profits/free-cash-flow, does not create legal-impediment to Centamin's rights of disposal. - Not totally sure. - Because of the implications, no doubt EMRA would be included in negotiations as they were with the 'Endeavour' bid.
Don't forget who also owns sukari !
If Egypt doesn't want it, there's always the poison pill of Egypts legal system.
As a 'rule-of-thumb' neo, a 40% premium to closing-price at time of offer is usually a ball-park figure. - It's not an exact science.
Also, it would depend on how the offer is made-up.
If we are going down this rabbit hole of speculation what price would you offer as a takeover price? Match the previous one a few years ago? Less /more?
If there is to be a takeover, and with Centamin's history, Cowichan's suspicions are entirely understandable, it will be sooner rather than later in my view. - Presently, in it's distressed-state, Centamin is naked and vulnerable. like a wounded-animal. -To go in for the kill now would make sense in my view. - Always supposing of course they are being stalked. - I agree with Dasut, an organised 'Sting' would be pretty brazen stuff and as Cowichan has already flagged to the 'Mining-world', his thoughts on what he thinks is going on, it would take some explaining.
Cowichan, guys Bristow is the CEO of a very large company the largest gold mining company in the world and I very much doubt he even knows the names of the people involved in the job swaps, let alone organised a "sting" that would be so obvious. Would Barrick be interested in buying Centamin of course they would, is it a priority given the profit share structure I am not sure?
The time in my view to buy into Centamin or Centamin personnel would have been prior to venturing into Egypt to gain a structure and people with knowledge but as I have mentioned previously Barrick have considerable experience globally with personnel that have been there and done it and a tried and tested structure of developing new markets.
It wouldn't surprise me if Barrick take a run at Centamin but I would also look at other majors such as Newmont and Anglogold Ashanti both looking to grow their portfolios and Centamin's properties would fit nicely into their core profile ( I also know of several people who have joined Centamin over the years particularly from the latter company).
Do we know if Bristow visited Sukari when he visited Saudi as my contacts say nothing about such an event ever happening?
In my opinion Bristow will know everything he needs to know about Centamin and will have detailed dossiers on a number of acquisition opportunities. If I was Bristow I would be using my office talking to senior political/civil servant types to be sure of the political risks in the regions and gaining valuable contacts at high political levels rather than a visit to Sukari .
There has also been mention made of phase 4 west wall waste area and the lack of information it is worth listening to the Q&A after the 4th quarter presentation as Horgan explained that they have been mining the area from memory as early as third quarter last year.
Bristow is a narcissist who from his past record cares little about environmental issues and I certainly wouldn't want to invest in any company he was involve with irrelevant of how much profit it made
https://www.ft.com/content/11058120-72a4-3ae3-9cf6-d5c310c05200
https://www.telegraph.co.uk/business/2018/10/01/randgold-boss-criticised-african-big-game-hunting/
Mark Bristow, CEO of Randgold (GOLD) and soon-to-be head honcho of Randick (ABX), and his penchant for shooting large African animals until they are dead. Then proudly posing for the cameras with the dead animal afterwards (normally behind the carcass,
https://iknnews.com/on-how-the-real-media-picks-up-on-mark-bristows-dirty-hunting-habits/
The problems that Sukari is now suffering is entirely the fault of the failure to adopt sound mining practice by the previous management CEO Andrew Pardey also complicit in spoofing the market about high grading which appears to have been condoned by Josef El Raghy , Youseff El Raghy who were also active in spoofing the market that Sukari was capable of 560,000 -6000,000 ozs per annum.
Spoonington you clearly don't understand Martin Horgan and his attitude towards takeovers the task in hand in turning around the company, or what is going taking place at Sukari which will become apparent as time progresses
Good work Cowichan, keep on at them.
I share your concerns regarding the pit wall problems, this is simply part of mining & should not take so long to resolve or at least see significant positive movements towards resolution. I keep seeing management & contractors saying they are ahead of schedule but this is not reflected in actual results unless their schedule is ludicrously pedestrian!
Either the current management is not up to the job or they are withholding significant information regarding the full nature of the problem (as you point out the information regarding the wall problems has been scant) or your Barrick theories have substance - no matter which choice we are not receiving the full truth.
Bristow is a top flight CEO, if he can pick up CEY cheap he will likely do so as, rightly so, he thinks of his shareholders benefit not CEY’s. I wish our CEO/BOD would do similar & hope your postings will encourage them to do so.
As another fellow minnow I thank you for your dogged representation of our interests :)
Spoon
Hi Cowichan,
As a share holder you are entitled to question the company and entitled to an appropriate response and I certainly agree that Mr Bristow has certainly not got to be where he is by playing fair with the share holders of any companies his parasitic Barrik decides to asset strip and suck the goodness out of.
I appreciate that any lack of response or brush off is frustrating, but never the less even if questions are being asked via social media and Linkedin it is still important to always use the official IR channels in communications to get everything officially acknowledged and recorded.
Its almost certain certain that some other share holders will have already made Alex and Buchanan aware of your Lnkedin posts
Tibbs
Fellow minnow
As I thought.
Keep it up.