Member Info for carvegyber

dollar started dropping because bond yields stopped climbing. It will fall big time if powell signals they will buy bonds to keep it capped. Good for gold.

Be interesting to see what price this opens at if gold start climbing. It has to overcome the 1760 hurdle now....

Judging by the price action, this is unloved in UK but the americans love the results.

They took out a big loan. I believe the plan is to use it to repay the remaining 2023 notes because not all holders redeemed them. Plus the fee for redemption made it not that worthwhile. It will be high for next 2 years until they are repaid but we are safe for 50 yrs! Ridiculously low price for such a long loan. It really shows the value of FRES. Bonds are a good indication of the strength of a company.

They took out a big loan. I believe the plan is to use it to repay the remaining 2023 notes because not all holders redeemed them. Plus the fee for redemption made it not that worthwhile. It will be high for next 2 years until they are repaid but we are safe for 50 yrs! Ridiculously low price for such a long loan. It really shows the value of FRES. Bonds are a good indication of the strength of a company.

They took out a big loan. I believe the plan is to use it to repay the remaining 2023 notes because not all holders redeemed them. Plus the fee for redemption made it not that worthwhile. It will be high for next 2 years until they are repaid but we are safe for 50 yrs! Ridiculously low price for such a long loan. It really shows the value of FRES. Bonds are a good indication of the strength of a company.

right now US 10yr bond yields are around 1.5%. Inflation is below this due to covid. Therefore gold is suffering plus higher dollar isn't helping. When inflation start going above the bond yield, that is the signal for gold to fly and silver will rocket.

The problem is, the western world is in lockdown so there isn't feedback on prices until things open up which will be summer. We have to wait 3-4 months for this to rocket back towards £20. It is achievable in the next 6 months but we need inflation above 2% to set in and feds to buy the bonds to keep interest rates down. Europe and Japan is already doing this. They can't afford to let the interest rate rise because those zombie companies would default with their covid debt loads and house price would fall triggering another credit crunch. They will be forced to act really and gold WILL fly.

Results beat analyst expectations and we are effectively debt free today and generating huge cashflow. Prospects for 2021 will not be worse than 2020 but probably a lot better because silver prices are a lot higher. Some 20-30% of 2020. How can this be moving lower?

If profits are to be shrinking, I would understand but it is growing.

hmmmph. I give up.

great results but disappointing price early doors. If MM are not playing games, I don't know what is.

Squeeky bum time fellas. Will it be up or down tomorrow? What is everyone's call? Be interesting to hear your views. I have put a big bet on up because I think results will surprise on the upside. I am calling at least 5% but could be 1000p again.

Let me know your thoughts.

Yes we need gold to start motoring.... Even without explicit YCC, all it take is for inflation to be reflected in official figures and gold will start climbing.... we are almost there. This summer will almost certainly see it. When lockdown ends in northern hemisphere, people will be flying and driving and out shopping.....

Pbear, you are spot on. Since 2011 there has been deflation and bond yields were high. Over 3%. That's why gold did badly. Now market is having a wobble when it climbs over 1.5% LMAO. What has changed though, mostly set off by Trump, is there is now trade wars and more nationalism so deflation imported from China is now reversing. Inflation has already set in despite what the figures tell you:
1. My mobile phones are not getting cheaper
2. Fuel prices are up
3. Tesco has stopped doing discounts. My shopping basket has increased 25-30% from 3 years ago.
4. Rent has stalled temporarily due to pandemic but my money is on it going back up big time once government removes the anti eviction rule and people start going back to work.
5. Energy prices are going up.
6. Car prices are going up
7. Copper and steel have more than double since 2 years ago. Building costs have gone up.
8. Builders are busier than ever and charging high rates. Anyone tried building any thing in their gardens? You will know this.
9. Freight rates have gone up 6 times.

How we will escape without inflation hitting at least 2%? Only thing that will save us a bit is Sterling has gone up. Inflation will exceed interest rate soon and that is when gold will fly and it will keep flying. I remember BOE had to raise rates to 5.5% when inflation hit 4% in 2007.

Not wanting to egg you on but I think good buy. Feds will have to act sooner or later. Gold at this price will find many buyers because bond yields are rising because of inflation fears. Gold is an inflation hedge. When the selloff stops, money will pile back into go. It is hard to read how low it will go though but I am pretty sure we are closer to the bottom than the top. Hence good buy

Bpat, the answer to your question is unfortunately: the market has to fall further....

Bond yield is up because bond investors expect inflation. US can't afford to pay higher interest for their debts because there is so much of it. Only way to bring it down is for the feds to print money to buy the bonds but that means they have to admit that they don't care about inflation which they don't openly want to admit. They are very much capable of doing that but they are hoping the problem will go away on its own. If it doesn't, then the only way for the feds to act is for the market to have more of a wobble....

I would bet on them acting.... otherwise, a rising yield could disrupt every thing. If they do act, then gold is going on another big leg up. I think PMs and miners will be much higher in 6 months time but in the very short term, we may have a wobble or two. 900 is a pretty safe level though.

Last year, our results were turning around albeit marginally and we just stopped bleeding cash. I had seen this and bought shortly before the results. Had a 10% gain in the next few days after that. Of course, the pandemic put a halt to the rise soon after.

This year, the results will be spectacular. I am counting on a repeat and adding. I just need some help from the gold price. If it rises over 1800 by tue, my gamble will be looking very good. DYOR and make your own play fellas. Good luck.

Actually, the gold revenue has been higher the last few years. Fres is the world's largest silver miner but it actually sells more gold! Silver price up does benefit this a lot.

So my final analysis is this:
Right now, gold is being punished because investors are worrying about inflation thus demanding a higher yield from the long term 10yr bond. Higher yield sucks money away from gold. But higher yields means feds have to pay more to borrow which they can't afford because they are already carrying too much debt. Only way out is to print money to buy the bonds or yield curve control. When the feds starts doing this, then gold will reverse and start rallying once more. This time almost certainly well over $2000 because the market will know there is no other options but gold.

Bitcoin now stalling is also good for gold but ultimately, bitcoin is still a sideshow which is more what the adoption will be like.

Yes, gold appears to be on a downtrend but silver is actually on an uptrend over the last 3 months. This is the ratio now catching up and with industrials opening up, it probably has further to run.

Gold is approaching a turning point now whether it will break the support of 1760. If that holds, I think it may well rally back to 1900s over the next 5-6 weeks. If it doesn't, well......you have to question if the value of gold is much lower. Surely, with so much more new money printed, it cannot be. Did you guys know that 25% of USD in existence has been printed in the last year? There is no way tax money will repay this and they cannot afford to let the interest rate rise because governments can't service the debt. Only way is default or inflate. Can't see US or UK default so looks like inflation will be the option.

For 2021, if PM prices stay at current levels and gold production hits top of guidance, we are looking at $3b revenue which would bump the net profit up to $1b level. Should be 1500p once that is evident.

Should PM rally from here, well......

Yes, I did this yesterday. I reckon revenue will be around $2.6b while costs remain the same or below. This will give us a net profit of around $500-600m which will be 150-200% more than 2019. Massive growth! despite lower gold production.

For 2021, I reckon gold production could surprise on the upside for 2021 but we have to wait until at least at the Q1 production report to find out.

JMT, I have seen this before and they can walk the price down easily. The problem comes from the fact that there is insufficient interest and buyers in this share. They use matched orders to drive the price down especially during periods of low volume. Compared to 2019, I reckon that Fres generated an extra $400m in cash and turnover with lower costs. 2021 will be even higher due to the silver price. Production in 2021 I don't believe will be a lot lower but more than make up for by the higher metal prices. Personally, I think 2021 may well surprised on the upside. They have been overly conservative with the production guidance I believe due to Covid.

I am very keenly awaiting results in a week's time and also the Q1 production report to see if it will exceed or miss guidance.

Lastly, we need gold to go on a surge again to really get the attention of the market. Gold miners are really getting hit. I am in Newmont too and I can't believe I am under water there.