Member Info for adamsmithfreethi

Me too. I'm also a CNR refugee and stalwart of the CNR AGMs which were fun!

Slimshady can vouch for me.

Definition of fiat money _

Fiat money is a government-issued currency that is not backed by a physical commodity like gold or silver. Its value is derived from the trust and faith that the public places in the issuing government and its central bank. In other words, it's legal tender declared by a government decree, but has no intrinsic value of its own.

I think you'll find life is rarely so mechanistic. Other things could easily impact the share price like, on the upside a bid or on the downside a complete loss of confidence that the company can finance its debts.

We'll see....

Strictly speaking THG share price and Whey concentrate are associative not correlated. For the latter to happen you have to establish a logical linkage.

Sure you say lower input price ceteris paribus equals higher profits. Except that ceteris paribus is b*llocks. The protein market is highly competitive (as is all retail nowadays) competitors would lower their prices and so would THG if it wanted to maintain sales. Result margins, tight already, would stay tight.

The best that can be said for the association between the two is that all consumers of Whey are price sensitive and if the price of the raw material goes up then so does the price and thus demand, industry wide, is crushed. THGs and its competitors are all negatively impacted. Now I can believe that correlation!

Hmm maybe but the possibility of having a multi bagger early exploration company is matched by by the equal possibility that they don't find enough gold to match the early excitement. In short they are an asymmetrical risk/reward profile and with the likelihood the price has already been pushed too high by all those dopamine hits I mentioned below.

Now I fully accept OMI is not the usual early exploration company but for the reasons we all know, but lack of cash is, in my opinion, likely to depress the price rise potential.

Take MTL which as you correctly say has 2.7b shares in issue. However they are looking to take a massive step up and produce not 80k oz a year but at least 160k oz and maybe over 200k oz. All from their own funds and thus no danger of future dilution. They are also currently on a PE of under 2. So double/triple the turnover increase the PE to say 4 based on a 15-20 year life of the new Nicaragua mine and hey presto you are looking at a 5-6 bagger.

Much less risk than OMI and the path to investing profit is clearer.

That's not to say I don't like OMI just that I hold 10x as much in MTL as I do in OMI. Happy to diversify that way too

What I'm trying to say is the cash gives you optionality. Optionality = value. Value = rising share price.

If you don't believe me look how options are valued. The greater the expected volatility i.e. the ability to trade at a price different from what you bought i.e. your degree of optionality the greater the price the options are quoted at.

If you don't believe me just ask Messrs Black & Scholes...

Hey I said I'm a cautious holder - for the record I bought at 2,4 & 8p

For now I'm not folding but sticking...

What I'm very much hoping for is that Brad gets a deal done with a nearby plant - I think he mentioned one nearby that's under used. He can then dig the high grades up since they seem to be very tightly defined, quickly turn that into cash - I really don't have a clue how much that would be at current prices but lets say 200k ozs with a profit of $1k per oz. That USD200m could buy you a lot of drilling with spare cash to go towards a mill if subsequent drilling demonstrated the viability of setting up your own processing somewhere on their tenements.

What kills retail investors when a miner is cash strapped is the constant need to go to institutional shareholders who get preferential treatment. New shares at a discount to the market price and maybe warrants to boot. Then it becomes a mug's game. We retail investors fund the risky stages when results are awaited and the big boys cash in once reserves are proved up and feasibility studies are completed.

A company with cash can cut that lot out!

As for companies in that position try - GGP, MTL, CMCL, SRB & ALTN & AAZ. With the exception of CMCL - all multibaggers so far with still more potential in them - I believe!

Granted the results have been excellent but in the current boom conditions for gold I have been cautious in the investing in this stock. Why?

Because the gold is still in the ground, also more work needs to be done to prove the discoveries up, no licenses have been issued beyond exploration, no money has been raised, no plant has been built and the company has yet to prove even if it had a producing asset it can produce the end product - gold - safely, efficiently and profitably. Think HUM!

The bulk of my investments are in targets that already generate cash, increasingly masses of it. They are also sitting on very exciting tenements with resources >1m ozs. Since all of the above conditions have already been met not least the need for OMI to raise external finance with the inevitable dilution that entails my other investments are, in my opinion, much much less risky than OMI.

Get excited about prospective opportunities if you like but don't let the dopamine hit lead you too far astray!

His/her posts and the inevitable huffy riposte never fail to elicit a chuckle.

Please don't stop my entertainment. Sorely needed particularly when markets are slow...

OK thanks - I'll take the plunge!

I'm getting a warning from my antivirus that there is a security certificate mismatch so haven't proceeded further to see what the new website is like. Anybody else had the same problem?

Yes I agree the RNS was the minimum necessary to reassure investors and everything remains on track.

Right now I'd rather the managers keep up the pressure to deliver low cost reliable and profitable mining at Runro and ensure the La India project doesn't get badly delayed.

I for one can wait until they are able to catch breath before needing anything more....

You had to an SHG holder and live through the whole experience to understand exactly how underhand the process was. The whole process was extremely convoluted e.g. from the CEO who was apparently moving on to a CEO entirely in the pocket of the PE guys doing the lowballing. That a a dozen other things that clearly had been planned and plotted beforehand. Yes myself and others did make money but only a fraction of what we could have made if we'd been allowed to remain shareholders...

You're overthinking this bargrak. At the moment the company has an exploration license which they use to extract ore which gets sorted and the concentrated ore sent to palito. The exploration license is automatically renewed after 3 years. Last time I asked the company had requested the exploration license allow them to double the ore extracted which could then be sent to palito.

The license you refer to is a production license for a plant in situ at Coringa. Currently this is not in the short to medium term plan of the company.

Mind you I take your point about PE wallahs. Whether it's with Thames water, juvenile detention centres or Shanta their basic business model is profit via screwing money out of "useful fools" e.g. the government, Offfwat and retail shareholders. I am definitely on alert for a bid and I don't want the same thing to happen to SRB that happened to SHG!

Firstly I hold ALTN. Secondly, I held HUM and lost a lot of money only salvaged by last minute manoeuvres when I realised the guy offering 2.7 was serious.

RetiredBanker I agree with all your comment s about the quality of the Board but the problem was they had been allowed to make mining mistake after mining mistake and had amassed a huge pile of debt payable largely on demand.

The company were insolvent not just illiquid and the only thing that saved them from going completely under was that any potential acquirer would loose the license and would have to negotiate with the Malian government under a new license of the existing mine and also reapply for the Guinea mine. In short unlike in most situations e.g. Thomas Cook it was cheaper for an acquirer to let the company fall and acquire it in a pre-pack, this is generally not the case with established mining companies.

Having realised this I piled back in at 2-2.1p and scratched out a profit roughly halving what I'd lost in total. H

It was hairy and I do not want to go through that again!

Yes there's a lot to be said for getting the Mali government to have skin in the game. So 10% free carry ok that's pretty standard now. The remainder 25% is not. Whether I'm happy with that depends....

The devil is in the detail. E.g. at what stage do they invest? What is the mechanism that determines what the price is? What are the rules for any future divestment or increase in involvement? Do the additional paid interest shares rank pari passu? etc etc etc

It's reported that gold is THE most crowded trade at the moment. Well that is certainly not the case with AIM junior miners. I note that EDV and HICH have jumped presumably because investor numpties can bring themselves to go beyond the top 350 companies.

Well EDV has operations in west africa and some in not so friendly jurisdictions so I'd question the solidity of the ownership of some mines.

As for Hochschild they don't seem to be very good at mining.

Look a little further down the list and what might you find I wonder......?

I'll be betting the company will be looking to conserve as much cash as possible if Bilboes looks a goer. I think the dividend is safe, ceteris paribus, but won't be increased. If they can squeeze say $10m a quarter then by the time they're ready to start paying for a new/used mill say in 18 months time they might hope to accumulate an extra $60m and add the $25m in the a/cs already then they should have a substantial amount of cash to spend . Given the lead time to set up the mill they might hope to fund the whole thing out of cash flow.

Now that would be a nice thing! Let's hope the pog holds up...

Well to be clear I made good money out of the Shanta takeover but not nearly as good as it would have been if the thieves had initiated their plan to save the "struggling" company.

And if I ever meet Eric again ....

You've ruined my day with takeover talk!!!

I was a shareholder of shanta when it got nicked from under our noises. I don't want to be done a 2nd time